The Goodland republic. [volume] (Goodland, Kan.) 1891-1907, 1902-10-24
sHAW,s TREasuRY PoLICY.


In 1883 the republican party de-
nounced the democratic policy Of loan
ing the government money without in
terest to pet banks" To day the re-
publican party IS leaning more govern
msnt money without interest to pet
banks" than was loaned at the time
when the platform Of 1883 was written
In fact. the present secretary OF the
treasury has gone far beyond any pre-
v1Ous secretary in responding to the
wishes and advancing the interests Of
pet banks" The partially shown by
the treasury department toward the
Rockefeller bank in New York is al
ready known; a letter written to the
secretary Of the treasury by one Of
the officials Of the bank demanded IA
Vors on the ground that the bank had
assisted the republican party in the
campaign
Blu the recent rulings Of Secretary
Shaw go beyond anything that has
heretofore been known It is gross IA
Yorilism to let the banks have govern
ment money for nothing in order that
they may loan it out to their customers
at the usual rate OF interest The fact
that they give bonds for security has
nothing to do with It, because they
time that they draw interest on the
government money which they are per-
mitted to loan out Heretofore the gov
eminent deposit has been considered
like any other deposit, and the banks
in reserve cities have been compelled
to keep 25 per cent Of it on hand as in
the case Of other money. But New
York banks had loaned out so much
money on the Watered stock Of the
trusts that they were not prepared for
any shrinkage in their deposits, and
the government at once went to their
aid, and by an order Of the secretary
relieved them from the necessity OF
keeping a reserve against the govern
ment deposit This gave them quite
margin above their legal reserve. In
addition to this, Secretary Shaw has
enlarged the basis of security required
Of banks. Formerly a bank had to
deposit government bonds. Now, &C
COrding to the new ruling, the bank can
deposit other securities, such as state
and municipal bonds. 1t is easy to
measure the enormous privileges thus
conferred upon the banks. If, for in
stance, a bank has a million dollars
worth Of bonds which it uses as a Sc
curfty for government deposits It can
now use these deposits to purchase a
million dollars worth OF state or mU-
nicipal bonds and substitute these for
the government bonds. 1t thus has its
bonds land they usually draw a higher
rate OF interest than the government
bOnds) and il makes a larger profit out
OF the benevOlence Of the treasury de-
partment. Having substituted other
bonds for its government bonds the
bank can now, under the law, secure
a million in bank notes and loan out
its money at the market rate while It
draws interest on the bonds and pays
a fraction of one per cent as a tax
to the government.
The national bank currency system
IS a source Of profit to the banks and
they can well afford to contribute lib
orally to the republican campaign fund
in order TO retain the advantage, but
why should the ordinary republicans
vote to tax himself for the purpose Of
giving this undeserved aid to a few
banking corporations? If the Ordi-
nary republican buys a government
bond he is out the use Of his money
and must be content with the interest
or the bond, but an extraordinary re-
publican engaged in the national bank
ing business can turn his bond into the
bank with other bonds and the bank
can deposit the bond with the treas
uTy department and get the face value
Of the bond in bank notes and still
draw interest on the bond besides. The
ordinary republican can either eat his
cake or keep it; the extraordinary re-
publican can eat his cake and keep it,
too.
Not content with this great ad-
vantage the bankers have been de-
handing and receiving a large profit
in the way Of the free use Of govern
ment money, and all Of the steps taken
! by Secretary Shaw have been in the
/ direction Of charging the privileges
| and profits Of the national banks. II
/ the ordinary republican, in his desire
l to make his money as profitable to him
/ as possible, loans out so much that be
I hasn't enough to run him through the
/ winter, the government doesn't rush
/ to his aid and correct mis- errors tC
/ save him from stringenCy in his f1nan-
l cial matters, but the extraordinary re-
/ publicans who control the national
/ banks can loans out their reserves
/ thus increasing their profits, and rely
/ upon the favOrs Of the government il
every time Of need If money rates
run up the treasury promptly supplies
/ them with money to loan at the great
/ Ct AaLc- anu really HIKES II 70 LuEAl
peculiarly advantage to bring a reCUr
/ renee Of such conditions, not to speal
Of the speculative advantage which
| can be found in an unsteady market
Whether the secretary has violated
/ the law in his effort to rescue tn,
banks is a question which viii proba
| bly, be discussed when congress meets
! but that he is running the treasury de
| partment in the interest Of Wall stree
| Is a question which is not open TO dis
pute. Whether his action viii frighteI
| dePOsitOrs and lead to further with
drawal remains to be seen, but he Ger
tainly has done enough to frighten tn,
rank and file Of the party and show
them that our government, instead o
being administered as a government o
the people, by the people and for tn
people. is really administered as a gov
eminent Of the corporations, by tn
Senator Thomas Patterson has Dur
chased the Denver Evening Times
| which means that the Evening Time