The San Francisco call., 1903-09-05
TIE CURRENCY QUESTION.

= ECkElAh4 SHAW has connTTned the report
given out from Washington some time ago
~ that he has accumulated in the treasury the
sum OF S4ooooooo as surplus OF which he avail
himself TO meet any stringency which may occur in
the money market during the crop moving season.
The fact tha: he has such accumulation adds in
terest to his statement at the Merchants and Travel
cfs banquet in Chicago on Wednesday that Of
the most urgent needs OF the country is the enact
nent OF legislation which will give TO our currency
the element of elasticity and thus put end to the
necessity OF using public money for the relief of
private banking.
The object of the accumulation is the avoidance Of
any such strngenoy OF money occurred last year,
when the Secretary forced to go several times to
The relief OF the money market for the purpose OF
preventing a situation that might have caused
panic. He was severely criticized for his action
the time and appears that this year he resolved to
try a new means OF meeting any emergency that
might arise, and accordingly set about storing up a
surplus OF public money which would be available
.for deposit in banks whenever he chose.
Under the laws all receipts from customs duties
must be deposited in the treasury and can be paid
only for appropriations made by Congress for
current expenses OF the Government Receipts from
internal revenue are, however, available for all pur-
poses for which the Secretary OF the Treasury draws
warrants Last year the Secretary had the internal
revenue receipts deposited in national banks where
;they were available for general circulation. 1t is
said the effect while beneficial to the extent that it
kept that much money in the channels of trade in
stead OF locking II up in the treasury, not wholly
satisfactory; and is for that reason the Secretary
has this year stored up the receipts instead OF de
posting them. With the sum now at command the
Secretary effectualy prevent the occurrence OF
anything ike a stringenoy at any time
A. statement Of the situation given out at the time
OF the first report OF the accumulation OF the surplus
presented the plan in this way The available cash
balance OF the treasury is in round numbers $23o,-
100000 Of which SI44 100000 deposited in the banks
10 the credit Of the Treasurer, and some SIooooooo
consists OF silver bullion and small coin, leaving S76-
100000 which may actually be used As the average
working balance supposed 10 be convenient for the
treasury is S5o.oooooo it will be seen that the
S4ooooooo relief fund would probably be used if at
AL only for a short time and IN manner to leave
it at the immediate disposal of the Secretary Still
with the present overhowing condition OF the treas
my; he could undoubtedly carry out any plan that
he might consider requisite for the prevention OF
acute disturbance
We may therefore assume that the situation for
this year is saved 1t is quite certain, however, that
the plan viii be subject TO as much criticism
that adopted last year will the criticism
.De necessarily announced he secretary has done
what is perhaps best under the circumstances, but
the Circumstances bad II not fitting that the
national treasury should be a part Of the banking
system OF the country Having $4o.oooooo available
Tor deposit it is certain that the Secretary will be
inportuned by many banks for portion at least
-o the fund; and while there will be no cause for
scandal on this any more than former occasions
of making deposits Of public money in various banks
still the system is bad Secretary Shaw himself rec
ognizes the evil and has repeatedly declared him
self in favor of a reform.
Reports from the East somewhat discouragine
Tor the advocates Of the desired legislation for it is
said there is strong opposition on the part of many
Congressman 10 undertake any kind Of currency legis
ation this winter Perhaps the situation as revealed
by the Secretary OF the Treasury may change their
minds. At any rate it viii confirm business men ir
their conviction that an elastic currency is badly
needed and should be provided at once