Willmar tribune. [volume] (Willmar, Minn.) 1895-1931, 1902-04-23
WEDNESDAY, APRIL %, 1902
TO CONTROL MONEY FUNCTION.

WEDNESDAY, APRIL %, 1902.
TO. CONTROL MONEY FUNCTION.
The republican platform of 1900
promised an elastic bank currency.
There was not much noise made about
this part of the platform by the re-
publican stump speakers, as it was
we'll known to them that the people
would not favor giving the banks
greater privileges than they are now:
enjoying. But being in the platform
it was of course "endorsed" by the
voters. Now an attempt is being
made to redeem this promise to the
banks. The Fowler bill, which bears
the title, "And act to maintain the
gold standard, provide an elastic cur
rercy, equalize the rates of interest
throughout the country, and further
amend the national banking laws"
was favorably reported to the house
on April S.
The main excuse given for the bill
in the report accompanying it is that
it will "protect the national credit
against assault through the demand
obligations of the government by COM
pletely relieving the treasury at once
of a burden amounting to more than
seven hundred millions. This mir
acle of fnanciering is to be accom-
plished in this way: The national
banks are to guarantee the redemp-
tion in gold of $3.50, 600, 900 of U. S.
notes. At the same time the govern
ment is to redeem half that amount,
paying the same in gold, which notes
are then to be cancelled and destroyed.
This does away with 1896, 100000 of
notes. The committee reporting the
bill figure that the $3.50, 900, 900 in the
gold reserve will balance the remain
ing 1851 900, 900 outstanding, as some
of them must have been lost or de-
stroyed. They forget, however, that
they have just before that provided
for using nearly one-half Of that re-
serve for paying the notes to be pre-
scented by the national banks. Next
they figure that it will relieve the trea-
sury of the burden of 1919, 600, 900 of
national bank notes of the present
system-for which the government is
not responsible now, except that they
are backed by government bonds that
in case of the failure of bank can be
sold to secure funds for paying the
notes outstanding. In view of this
and of the further fact that the Fowler
bill does not say word about the
retirement of said notes it is difficult
to see how the bill relieves the govern
ment of this burden. The only thing
that we can see in the line of temper
airy relief is the $3.50, 900, 600 assumed
by the banks. The government will
redeem said notes whenever it has
gold enough to do it, so the burden Of
the redemption of even these finally
falls on the government.
In return for assuming this temper
airy responsibility the national banks
are given the privilege of issuing notes
based on their capital. Each bank
that 80 guarantees U. S. notes equal
to twenty per cent of it's capital can
Immediately issue notes equal to ten
per cent of it's capital, and each sue
ceeding year issue the same amount
until toe notes equal the capital. For
the first two issues they shall pay a
tax of one-fourth of one per cent,
which tax does not go to the govern
ment but into redemption fund to be
used in paying notes of failing banks.
For the next four issues the tax will
be one and one-fourh per cent, and
on the remaining issues three per cent.
This tax, however, is not upon the
total issue, but upon the average
amount of notes actually in circula-
ton during the six months preceding
such payment. Money not used will
thus escape taxation entirely.
The bill recognizes the fact that We
have possessions that are neither
states, territories or districts. Banks
may be organized to do business in
these ''possessions," but no bank
with q paid-up capital Of less than
dive million dollars need apply.
The hollowness of the claim that the
bill will relieve the government of a
great Blu, den in the way of redemption
liabilities is at once apparent when
we come to the silver clauses of the
measure. 1t specifically makes the
silver dollars redeemable in gold
upon presentation to the treasury.
The secretary of the treasury is au-
thor'zed to transfer any gold in The
general treasury at the time of the
passage of the act to fund to be
used for the redemption of the silver
dollars. AS the outstanding silver
certificates and silver dollars in cir
culation amount to $4,000, 900, any
one ought to he able to see that the
purpose of the bill is not to relieve
the treasury of the burden of redemp-
ton liability, but to relieve the banks
OF the competition of the greenbacks
and give them a chance to issue cur