Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1900-03-24

We're All Dorm Ill llilS CITY. JGt' SOILS al
In their last report the State assess
Ors suggest that Of S3S 900, 900 in bonds
Of Maine railroads ana street railways
outstanding, only $1,000, 900 are held by
the Maine savings banks, and conclude
that very large amount of them cs-
cape taxation. To Il great extent such
conclusion is justified. If at loss to
locate the much greater portion of The
better class Of Names railroad bonds,
however, the difficulty could have been
easily solved by search among the
assets Of banks i'm states who's taN-
rate does not prohibit such holdings.
and upon which assets reasonable
dividend can be paid ~ them, notWith-
standing the high cost ~ such securi-
ties. created by their own demand for
them. In fact, that issue of bonds in
whose interest it is quite generally I'M
drrstood the 'discriminatiye" feature
Of our law was designed was after
wards found legal for the banks Of q
neighboring state. ana hardly a dollar
of the issue reached the banks of our
own. 1t follows. of course, that Maine
best securities having been absorbed
hy banks in other states, we were eX-
pcctcd To invest in those uf lower
grade. which such banks would not ~
permitted to purchase. Had the law
carried with it Il reduction Of tax on
the better class Of Names securities,
or on all Of them, to such extent as
would have enabled us 10 compete fur
the best with the banks Of ncighboring
states, some scmblancc If consistency
would have been seen in the results.
But it seems to have been the old de-
termination, simply renewed, to exact
the pound Of flesh. and to increase the
number Of ounces making it.
our lawmakers declare that Maine
banks discriminate against Maine
securities, ana insist that we exhibit
Il larger degree of public spirit, while
they, year after year, by their official
action, discriminate to the injury Of
Maine depositors. ana in the interest NJ
others by law more highly favored.
our legislation insures the choicest Of
Maine investments for the banks of
other states. and their lawmakers see
to it that they have a reasonable in
come from them.
To what extent this "discriminativc'
feature has increased the holdings in
Maine banks of Maine securities.
think it would be hard to tell. Neither
do | know if they have increased in
proportion to the increase in deposits.
The bank | have the honor to repre-
sent. has made no investment under
this law that | can now recall, which
it would not have made if such law did
not exist. We We're always seeking
Maine investments Of a character
meeting the requisite conditions. we
do not boast that this was done alto
gether from motives suggested by pub
lie spirit, unless that commenddble
virtue was evidenced by a desire TO
serve the interests of the depositors in
at least as large a measure as those
behind the investments. our course
was dictated by what we believed to
be the principles of sound business
cOmmon-sense.
l have said that this particular
feature, under conditions and circum-
stances. was unjust. 1t 50 appears to
Us unjust in its effect. both
to the banks and the deposit
ors. And by implication it was
a reflection upon the intelligence, judg
ment and business ability of the sew
eral mana gements. In making other
Investigations | have been interested
in ascertaining if savings bank man
agement had warranted this implied
reelection or criticism, whether in
tended or accidental.
his yrarv avoaIIa1t rannrt 1905
the bank examiner estimated that in
handling an aggregate Of $500 100000 in
the eighty years preceding, the man
agement of Maine banks had subjected
the depOsitors to loss of but two
mills on a dollar of the entire amount.
In this connection the examiner makes
the following statement: another in
stance cannot be found in the history
of financial affairs where such large
sums Of money have been invested
with so small a percentage of loss
A still more remarkable showing. ]
think. has been made in the ten years
from 1890 to and including that just
closed In that period 1893 marks, as
we all know, the beginning of six years
of the most extensive and disastrous
business depression the country has
ever experienced. From and including
1898 to the beginning Of the present
wear there were throughout the coun-
try 90.7 business failures. with
liabilities aggregating $1,375, 100000, and
an excess of liabilities over assets of
$37S, 900. 900. In the Eastern states alone
there were 1851 failures, with liabili-
| ties of $216,000,000, which figures eX-
| ceeded the assets in the sum Of SILL
| 200. 900. In one of the years interven-
ing it is estimated that railroad cor
porations. representing one-sixth OF
! the entire railroad lleage of the coun-
trv. were in the hands of receivers.
| In the ten years including and fol
| lowing 1890 it is estimated that the
J Maine savings bank officials had the
care of and handled (combined) Il tota
of $50. 600. 600. And during that period
they have paid uninterrupted diyi