The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1900-01-19
ACT OF GAGE.
New York Tribune Questions
Its Wisdom.
Carefully Analyses the Secre-
tary's Statement.
MONEY CAUSE HURT.
Reply Does Not Make Clear That
Deposits He Made
We're at All Necessary to the
Public Welfare.

The New York Tribune (Republican)
January Is.
SECRETARY CAGES STATEMENT.
No reply could well be more clear or
complete than that of Secretary Gage
to the inquiry regarding deposits Of
public funds in the banks. If there had
been any need of evidence as to the
integrity Of the secretary and his sin
cere desire to serve the country with
absolute fidelity there could hardly be
better than this frank and manly state
ment of the law as he understands it,
and of the purposes which govern his
action. Among fair minded and well
informed persons there has been no
question of that sort. The natural doubt
whether the judgment Of the secretary
may in this instance have been mtsta-
ken is in no way inconsistent with en-
tire faith in his uprightness and genu-
inc devotion to the public welfare. The
discretionary power intrusted to the
secretary by law, though by other Re
publican secretaries held to be granted
for purposes entirely apart from relief
of the money market, was without doubt
honestly interpreted as covering the
latter object by President Cleveland'S
secretary of the treasury, and though
his action was strongly criticised by his
Republican successor, Secretary Vim
dom, the same construction of the law
might with equal honesty be urged now
by ex-Secretary Fairchi1d as bank
officer and adopted by Secretary Gage.
The real question concerns the wis
dom of the course adopted. The fact
that Secretary Gage himself did not
believe that any emergency existed
which called for interposition by the
government, even the very day before
he adopted that course, according to
published statements purporting to be
from him, indicates that there had been
in his mind the same doubts which from
other minds have not been removed.
The business world is entirely aware
that the difficulty in the loan market
arose from the extraordinary amount
of funds advanced on stocks active In
speculation, and particularly on stocks
of industrial companies as collateral, or
in connection with the promotion and
financing of those companies. No one
supposes that the business world was
dependent upon the success of these
speculative operations or the cOntinu-
ance of these loans. There was a deep
feeling Of satisfaction in legitimate
business circles when the extensive Ii
quotation in such stocks gave promise
Of a less dangerous situation.
Full and frank as it was, the reply of
the secretary does not make it clear
that the deposits which operated to ar
rest this liquidation and to permit a
new speculative rise in the industrial
stocks were necessary to the public
welfare They have, in fact, helped
to revive in the new year the uncertain
ty resulting from wild fluctuations in
such stocks. While the money holds
out, excessive speculation will absorb
more and more of it, and experience
has not taught that relief from the
difficulty comes through feeding the
fire. It is altogether possible that the
secretary was so informed that he be-
heVed legitimate trade and manufac-
turing in real embarrassment for want
of available funds, but all the best
trade journals and financial writers
agreed with THE Financial Chronicle
in stating that such interests had been
sufficiently supplied and were not in
trouble
The wisdom of the course pursued can
not be adequately judged without TAX
ing account of its influence upon pub
lie opinion. Secretary Gage is far too
experienced and sagacious not to real
ize that good cause may sometimes
be damaged more by kindling mistaken
prejudice or unfounded suspicion than
in any other way. 1t is obvious now
that opponents CT the administration
and its financial aims have chosen to
stir up excitement about public depos-
its with some Of the national banks, be-
cause they think popular feeling can
thus becreated against measures which !
the secretary favOrs. The suspicion of
favOritism in the treasury or the post
office department may be met in the |
most conclusive way without removing |
the mischievous impression produced
1t was largely because the policy of
making deposits with the banks to help
the money market was sure to create |
suspicion of Partially that Secretary
Window argued earnestly against thai |
course. Not even the warmest friend |
Of Secretary Gage can doubt that the |
cause Of sound money has been hinder
ed rather than advanced by the ques- |
lions raised within the last month. and !
meanwhile it may fairly be doubted !
whether the business world has been |
really aided.