The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1903-06-28

1
when all notes were promptly redeem
ed upon presentation. The home banks
followed the example Of the other institu
tons they could not hope to maintain
specie payments when the commercial
centres, New York and Philadelphia
| were Frustrated by lack OF confidence
| IN 1856 or 1887 the Independent or sub
| treasury scheme had come before the
people Of the State. ON this issue they
we're divided. Governor Dudley opposed
it. He feared that it would discrdt the
bank notes and cause the ruin OF the
| State banks which he greatly favored
on the grounds OF permanence, owing TO
the fact that national politics had not
entered into their management. Other
| arguments he advanced iii their favor in
his message to the General Assembly.
but further urged that considerable re-
formation should be made IN them He
claimed that they were too numerous their
capital TOO small and variety Of notes
TOO great, aud recommended the charter
Of bank with q capital of ten millions
of dollars allowing al the banks then in
existence to subscribe all their capital
stock. and the remainder to be taken
bv Individuals "The State he says
should transfer all It's stock and funds
to the bank. and offer to serve
/ the Federal Government as de.
postary Of its funds: the safety and
Forthcoming OF which is the kind of
money deposited to be guaranteed by the
State. and in the event Of the bank being
unable to pay this The state to issue stock
for the amount in favor Of the govern
ment. bearing per cent interest until
the bank is able to resume payment. For
these services rendered to the general gov
eminent the notes issued by the bank are
to be received in payment Of all its dues,
,and on the further condition that the
other States prepare their banks in like
manner and for like purposes, namely,
that each State and territory shall desig.
nate by law one bank of capital not ex-
ceeding ten nor less than two million dol
lars as its own depositary and the deposi-
| tary of the general government and If
requested by the President of the United
States. other banks for that purpose; a
second bank shall however, IN no case
be chartered or designated. until the
| capital of the first shall be entirely taken
and so on to the third fourth and fifth
when necessary. The notes of the banks
thus made depositaries TO be engraved OH
similar paper and to resemble each other
as nearly as possible. If any State refuse
or neglect TO come into the arrangement.
the money collected in such State By the
general government shall be transferred to
a depostary Of some other State nor
shall the money collected in the refusing
State be received in anything but coin
! This idea was never carried out. The
| independent or sub-treasury law was
passed by Congress, in 1910, soon repealed
and later restored to become permanent
system
During the years OF financial depression.
from 1881 to 1912, there were from time
TO time applications to the Legislature for
charters OF several large industrial ard
| banking schemes, a few Of which were
granted, none of which ever became per-
manent organizations. Their general pur-
| rort was the construction Of railroads and
bother industrial developments Prominent
bamong these was the Southwestern Rail
road Bank, chartered in 1887, comforting
/ Blinking facilities on the Louisville. Gin
cinnat and Charleston Railroad Company
The corporation was separate and dis
tlnct, the bank was not liable for the
railroad, but the railroad could be held
for the banks debt in case Of failure
The capital of the bank was to be S12.-
000,0 with head office at Charleston. s
c., and branches in North Carolina west
of the Catawba River. 1t had charters IN
four States and its il. or vas to construct
a railroad from Cincinnati. o.. by as direct
route as possible to Charleston s. c. The
capital could not be raised and the enter.
prise failed
Just prior to the second suspension or
the State Bank in 1912, it was the subject
of constant political discussion 1t Lad
/ become unpopular While it was a fact
that the bank had by superhuman effort
resumed specie payment during the sum
mer, it was clearly only 4 matter of time
when a second suspension would be neces-
sary. However, with the hope that
autumn would bring relief. notes continued
TO be redeemed IN gold or silver But au,
tumn brought no brighter prospects.
There seemed 10 be little inducement to
the directors to continue tie struggle and
| they seemed prepared TO discontinue op,
creations altogether Accordingly resolu-
| tons ere passed by the stockholders in
January. 1913, requesting the General AS
semhly to propose some method for closing
! the banks business. Governor Morehead
Istrenuously opposed any such movement
and in his message to the Legislature he
dwells at length on the states position n
the matter, holding that tie interests Of
the people Of the state would not be
promoted by closing the institution IN
spite of the Governors protests. the House
| of Commons passed resolutions accepting
the surrender of the banks charter with
rather acrimonious references to its ret.
ord II suggested that a committee should
be appointed to ascertain how and IN
what way this surrender NAV be best
used as a means to relieve the people
instead OF expressing them The SEN
ate. fortunately, did not pursue the radi-
cal course of the lower house but sug
gested certain remedies and safeguards
whereby greater protection could be had
for the people, and more stringent laws
regarding management. The more con-
sentative policy of the Senate gained the
day. and the Bank of the State continued
business Duncan Cameron, its president,
submitted a statement showing that dur
ing the ten years from 1884 to 1874 the
bank had paid out in dividends 1899 $50. rs.
Of which the State had received 1896 324.7
besides twenty-five cents tax per share
from each stakeholder, aggregating $22.