Gloucester County Democrat. (Woodbury, N.J.) 1878-1932, 1900-01-18
Mckinley VS. Mckinley.

The government OF the United States
has at the present time about one hundred
and twenty millions of dollars on deposit
with the national banks of the country
upon which it receives no interest. Thu
money is deposited in the banks without
any interest charge, the banks furnishing
government bondsas security. The banks col
ltct interest upon their bonds as usual and
loan the money TO spectators at rates
varying from five to ten per cent. interest
Ii is amusing to note that considerable
number of Republican administration
organs are critieising the conduct of Score
tary Gage, in the matter of depositing
public funds, entirely ignorant of the fact
that their criticism Of him is condemns
ton of President Mckinley. In 1855
President Mckinley, then a member Of
Congress, condemned in unmeasured terms
the policy of loaning the government
money without interest to pet banks
instead of using the surplus to reduce the
public debt. 1t will be remembered that
when President Cleveland was elected
President in 1884 there was large surplus
10 the Treasury, and that none of the out
standing bonds of the government were
due and payable, and that acting under
the provisions of a law attached to an
appropriation bill in 1881 the Secretary of
the Treasury purchased a considerable
portion of the public debt at the market
price as a means of relieving the Treasury
of lis surplus. This process. however, re
suited in the government becoming a bid
der for its own bonds against the market,
thus enhancing the price In view of this
fact the Secretary of the Treasury asked
Congress for more explicit authority to act
in the premises. By consulting the Con-
qressional Record of the Fiftieth Congress,
February 30, 1888, we find the following
in a speech made upon the floor of the
House by Congressman William Mckinley:
When we adjourned we left him full power to
pay it Cthe surplus out, and wish some friend
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did not do it in the only straightforward logical
businesslik way-that is, by paying the debts
OF the government and saving the interest
charge which rests SO heavily on the people.
Instead of doing that, the administration prefers
another way. 1t prefers to use the banks as a
m cans of putting it in circulation.
Mr.. Mckinley then proceeded to hold
this bank gift policy up to public male
diction:-
Nearly S59, 600 600. as 1 understand, of the sur
plus money that ought to be in the treasury to-
day, the Secretary having refused to pay it out
TO government creditors, is now out among the
banks, held by them, they giving TO the govern
ment bonds as security for the deposit; and they
are getting it without interest. They have the
surplus money of the treasury in their own
hands, and they collect the ACQUIRING interest on
the government bonds which they have de-
posted as security, when if the administration
had used the $50, 600 and bought a cores
ponding amount of bonds with that sum, those
bonds would have been Cancelled and the inter
est on that sum would have been stopped. And
charge here to-day that the President of the
United States and his administration are solely
responsible for whatever congested condition we
have in the treasury, and whatever alarm pre-
walls about the finances of the country. Every
dollar of it would have paid dollar of the
government debts if the Secretary had wisely
exercised the direction given him by law.
What does man do who has got a surplus
balance in the banks and has outstanding debts
bearing INTEREST," He calls in the evidences of
those debts and pays them off with his surplus
deposit. That is what a business man would
have done. and that is what business admins
tration would have done; and we would have
had $4,000 900 less of interest bearing bonds in
circulation to-day if the President had followed
the way blazed for him by the Republican party.
When the Republican national conYen.
ton assembled in the year 1888, President
Mckinley, as chairman of the committee
on resolutions, prepared and had inserted
in the platform of the party resolution
denouncing "the Democratic policy of
loaning the government money without
interest to pet banks"
1t will be noticed that President Nc
Kinley charged the responsibility for
Secretary Fairchild's conduct upon Pres
ident Cleveland. Therefore he will not
now undertake to shirk responsibility for
the action OF his clerk, Secretary Gage.
Mr.. Cleveland's Secretary of the Treas
ury deposited ffty-nine millions of dollars
in the banks without interest rather than
buy bonds at rising and extortionate
premium, but Mr.. McKinley's Secretary of
the Treasury has deposited one hundred
and twenty millions in the banks without
interest instead of buying bonds, as Pres
ident Mckinley insisted should have been
done by Mr.. Cleveland instead of deposit
ing the money of the government in pet
banks"
Thus it will be seen that Mr.. McKinley's
criticism of President Cleveland exactly
fits his own case.