The Leon reporter. (Leon, Iowa) 1887-1930, 1900-02-01
a BLOW FROM a FRIEND.
The New York Sun. Republican. SmAshes
the Currency Bill.


The debt refuDding scheme, which
the senate finance committee has at.
tached to the house currency bill, is
avowedly intended for the benefit of
the national banks. 1t proposes to
create $3.50, 600, 600 at 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 a tax of only
per cent. per annum, and clearing on
them profit Of J.! per cent, per an.
mum.
BY the provisions OF the national
bank act, the government not only
guarantees indirectly through its bonds
the redemption of national bank cur.
rency, but undertakes, directly, should
any national bank fail to redeem it's
enotes at once, selling the bonds after
ward to reimburse itself. 1t the bonds
should fail to produce enough to repay
what has thus been paid out, the gov
ernment gets back the deficiency only
after the banks assets, on which it has
prior lien for it, are liquidated.
Furthermore, when any national
bank for any reason surrenders its
circulation, it pays the government an
equal amount Of lawful money, and the
government thereupon assumes pay.
ment Of the circulation. The notes
thus surrendered become, therefore,
1.-The direct debt Of the government.
They amounted, in the aggregate, at
the beginning Of, this month, to more
than $S6, 6,0OO, 900.
1t is only because the national. banks
issue circulating notes to serve as
money that the federal government
takes charge of them.
Of the two currency bills before con.
gress, both provide for the maintenance
lofa paper currency issued directly BY.
the government, and forts redemption
lin gold on demand by a sufficient gold
redemption fund. One or the Other
of these two bills is pretty sure to
become law. Then the government
notes will be as nearlya perfect form
of paper money as human wit can
devise. The government, if all else
fails, can, to redeem 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 debtors owe them.
i This. being so, the perpetuation of
| the ma tional bank system becomes not
only unnecessary but source Of use-
less expense to the nation. In the
course Of the next two years, the
charters of most of the national banks
expire and need not be extended. II
their stockholders desire to continue
in business they can reincorporate un.
der the 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 car
issue an equal amount of its own notel
in redemption of an equal amount O
bonds, and thus prevent a contraction
of the currency and save considerabl,
interest.
To make the perpetuation Of nation
al bank currency q part of the Repub
iican program is to raise, deliberatel,
and unnecessarily. an issue which tn
party of Organism. will be only to-
happy to take up. The question 70
the Republican party is: Shall We, b.
entering the next presidential cam
paign ..s the champions Of nations
bank money, give to the cause of Bry
anism strength it could not othel
wise hope for, or shall we let the bank
go?
Common sense is in favor Of answer
ling the question against the bank'
In at the national hanks pot