The sun. [volume] (New York [N.Y.]) 1833-1916, 1900-01-09
Let the National Banks Go!


Let the National Banks Go!
The debt reiunding scheme, which the
Senate Finance Committee has sttaofei 10
the House Currency bill. Is avowedly
Intended for the benefit OF the national
banks. 1t proposes to create ss5O,OCO o
Of 2 per cent. thirty-year Government
bonds. In order that the banks may take
out circulating notes against them to their
par value paying on the notes q tax OF only
u Der cent. per annum. and clearing on
them Q profit OF ~ per cent. per annum.
By the provisions Of the National Bank
cot, the Government not only ~guaranteesin In
directly through its bonds the redemption
Of national bank currency, but undertakes,
directly, should any national hank fail, to
redeem Ito notes at once, selling the bonds
siterward to reimburse itself. II the
should fail to produce enough to repay what
has thus been paid out, the Government
gets back the deficiency only after the
banks assets, on which it has a prior lien
for 1t. are %liquidated.
Furthermore, when any national bank.
for any reason, s%urrenders its circulation.
1t pays the Government an equal amount OF
lawful money, and the Government there
upon assumes payment OF the circulation.
The notes thus surrendered become, there.
fore, the direct debt Of the Government.
They amounted. in the aggregate, at the
beginning Of this month, 10 more than
$50, 900, 900.
The Government also carries on the
work OF engraving and printing the national
bank notes, and of redeeming them out OF
a 5 per cent. fund OF lawful money furnished
by the banks for the purpose. 1t also
maintains at an annual expense OF over
5000, 900, the department OF tho Comp
troller OF the Currency at Washington, with
nearly ono hundred clerks, besides a num-
Der of special examiners paid by the banks,
TO supervise the affairs OF 300 national
banks and to protect the public against
loss by their mismanagement.
The sole justification for all this expense
Ind labor isthe furnishing to the people ola
>lle and sound pape- currency. 1t is not
pretended that State supervision would not,
IN other respects, as amply suffice toensure
the solvency of banking corporations, as
chat OF the Federal Government. II is only
because the national banks issue circulating
notes 10 serve As money that the Federal
Government takes charge of them.
OF the two currency bills before Con-
gress, both provide for the maintenance OF
a paper currency issued directly by the
Government, and for its redemption in gold
on demand by a sufficient gold redemption
fund. One or the other Of these two bills
is pretty sure to become a law. Then. tho
Government notes will be as nearly a per-
feet form Of paper money as human wit can
devise. The Government, if all else fails,
con, to redeem its notes, always levy and
collect taxes or sell bonds, whereas banks
must wait upon their debtors, and. possibly,
fail to collect the whole of what these debt
ors owe them.
These things being so, the p~erpetuation
of the national bank system becomes not
only unnecessary, but Il source Of useless
expense to the nation. In the course OF
the next two years, the charters Of most
OF tho national banks expire and need not
be extended. II their stockholders desire
to continue in business they can reincor-
porate under State laws, losing only the
privilege OF issuing circulating notes, which
never should have been given them. In
place Of the circulation which will thus be
retired, the Government can issue an equal
amount OF its own notes in redemption Of
An equal hLlOuDl %! bbulS, dul JluS nOtn
prevent a contraction OF the currency and
save considerable interest.
To make the perpetuation OF national
bank currency a part Of the Republican
programme, is 10 raise, deliberately and
unnecessarily, an issue which the party Of
Organism will be- only too happy 10 take
Up. The question for the Republican party
is: Shall We, by entering the next Pre5i-
dental campaign as the champions Of
national bank money. give ia the cause OF
Organism a strength It could not otherwise
hope for, or shall W. let the banks go?
Common sense is in favor Of answering
the question against tho banks. Let the
national banks go!
A New Issue for the Colonel.