Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1903-11-24
THE BANKING LAWS
Republican Leaders In Con-
gress Hope to Be Able to
Pass Financial Bill
WOULD PREVENT sTRINeENcY
Canal Bonds to Be Made Acceptable as
Security for Notes Issued for circu-
lation-outline of Plan to Fortify
the National Banking Act News Of
Washington.

Washington, Nov. 24.-Altho il has
been generally understood that there
will be no extensive financial bill
passed at this session of congress for
political reasons, there nevertheless Is
a strong desire to make certain sslter-
atoms in the existing law governing
the conduct of national banks Some
of the republican leaders have been
much afraid there will come turn of
the tide between now and election day.
They fear If the wave of prosperity be-
gins to recede even in a slight degree
i. might have q disastrous effect Upon
the next presidential election unless
the effect can be anticipated and pro-
vided for.
There is an evident disposition to
strengthen the national banks in every
possible way, SO that in case there is
any stringency in the money market 1t
will not react on the banks. Along
this line Is a sentiment in congress
which has been referred to occasional
~ in favor of the issuance of bonds, for
the construction of the Panama canal.
Including, of course, payments to the
canal company and to the Panama. re-
public, 1t is felt to be wise move NOT
to draw ON the treasury balance any
more than Is absolutely necessary.
The canal Is for posteriiy. of course,
and it is felt to be only just that the
burden should be distributed thru
many years.
The existence Of a large nominal
cash balance in the treasury is likely
TO be seized upon by the democrats as
reason why bonds should not BIZ is
sued. Many republican leaders say,
however. the people understand the
situation SO well as to prevent any po-
litical use being made of a canal loan.
Newspaper discussion has we'll estab-
lished the fact now that the exis ting
cash balance is only balance in name.
II is really an asset owed by the ma
tional banks to the government. 1t
remains In the hands of the people at
large, however, and can be. and should
be treated as a good asset, but not
as cash in hand.
Therefore, 1t is believed by the best
it will be good policy 10 issue bonds
for all extraordinary expenditures
created sor the account of the Pan ANA
canal.
Canal Bonds.
Along this line and as a part of the
general program of non partisan finan-
cial legislation Senator Fairbanks, of
Indiana, who enjoys the confidence Of
the business community and pariicu-
larly of the banks and railroads 4, an
extraordinary degree, introduced yes
terday bill to permit national banks
to deposit any bonds to be issued on
account of the canal as basis for
the tax on circulation be-
ing at the preferred rate of half a cent
a year, the same as on the new 2 per
cent loan.
1t is believed that practically all
bonds to be issued on account Of the
canal would be seized upon eagerl.s by
banks. SO the effect would be twofold.
The canal securities could be foated
without the slightest difficulty and the
banks would thereby be induced to put
out more notes. thus increasing the
stock of money in this country and
preventing the slightest drain on ac-
count of the canal.
Senator Fairbanks Is not alone ir his
desire to put the national banks IN
position where they can weather any
financial storm.
Suggested Changes.
II have just completed a bill de-
signed to remedy some defects in our
financial systems" said Representative
Hill of Connecticut, who was a mem
Der of the banking and currency COM
mittse in the last congress. Il drafted
1t for the purpose of eliminating some
of the flaws in the present laws. 1t
deals with details and not the general
subject. II provides for the Issuing of
gold certificates in denominations of
$40. Under the present law the SMALL
est gold certificate Issued is $40, aid !
see no reason why man who has a
$40 note should not have a RICH. to
exchange 1t for gold.
1T also provides for repeating the
limit on the amount of subsidiary coin
which can be turned on. at the mlnts.
That now is fixed at 100000 per
month. 1t gives the national hunks
authority to issue one-thil'd of their
circulation In s. notes instead of ',ne-
sixth. 1t also provides for removing
the limit on the amount of circula ton
which the national banks can retire.
Under the existing law only $3.00O,00o
can be retired each month 1t is pro-
posed to give the banks the right to
retire and issue circuia ton as the de-
mands require.
Another proposition contained In
the bill is to give the secretary of the
treasury authority to deposit customs
and miscellaneous receipts in national
At present only internal
revenue receipts can he placed In ma
tional banks. This measure provides
for treating all government receipts
alike in this respect. ! do not know
whether there will he any legislation
on this subject during this congress,
nut l intend to introduce the bill and
to have It adopted If possible. believe
there can be no objection to it IS 1t
contains no faGs"