Willmar tribune. [volume] (Willmar, Minn.) 1895-1931, 1903-10-17
the REPusL,cAas' new VIEW.


by the populists in the agitation for
a reform in the money system in this
country was that the refunding opera
tions by which the national debt was
perpetuated was in the interest of the
national banks and an unwarranted
burden on the people. Like other
populistic ideas this was ridiculed as
the crazy notion of a lot of ignorant
agitators who hated the rich classes.
But the truth will out. The following
clipping from the St. Paul Dispatch,
strongly republican paper, shows
that the light is breaking in on some
of those who ridiculed the populist
notions most mercilessly: g.
Back in the days, after the war,
when the pledge to retire tho: green
backs was being redeemed under act
of congress by Secretary McCullochs
we began to hear men say that q
''publlc debt lis public blessing. :"
Later We heard more Of 1t when re:
funding operations were being urged
to renew and prolong the debt And
at the time the cry WAS quite popular.
But old fashioned ideas prevailed,
and congress established Z sinking
fund which aimed at the gradual ext
tinguishment of the entire debt. The
process was going on rapidly, accele-
rated by the application of the sur
plus caused by excessive taxation,
but interrupted by the panic OF '93,
which caused an increase, and again
by the Spanish war. OF late years,
however, we have heard little of the
doctrine, until now, when We hear 1t
again made by the president Of ma
tional bank in q magazine article on
the currency. We saw it take con-
crete but silent form in the refunding
operations by which $500, 00O, 900 Of
maturing bonds were extended for
longtime periods, excused and justi-
fed by the lower rate of interest Sc
cured. Secretary Shaw acted upon
that principle when he offered, last
March, to refund S1O0, 900, 900 -matur-
ing in @l9O7 8 into thirty year per
cents. We may hear it again when
congress gets bill before it to change
the basis of bank-note security from
bonds to a guaranty fund, miscalled
'Fasset currency Stripped of it's
redundancy, the proposition, badly
stated, is to perpetuate public debt
of-now-$9l4, al, 400, upon which
there was paid last year 1928, $50, 348 in
interest, for no other purpose than to
enable 5,044 national banks to issue
$417, BAG, 487-less than half the debt
in bank notes. The refundine opera
tions of Secretary Shaw will oblige
the taxpayers of the country to pay
out sc, ZOO, 900 in interest in the next
thirty years to furnish bond basis
forS 100, 600, 900 bank notes. From q
bankers point of view this may be q
blessing; from the public's it looks
like paying very dearly for the
WHISTLE"
It is rather late in the day for the
Dispatch to make this discovery, but
better late than never. The people
have been "paying dearly for the
whistler for thirty-six years. The first
step was in ''redeeming" the non-in-
terest bearing greenbacks, which cir
culated as money, with bonds bearing
a high rate of interest, in order to
make room for the national bank
notes, which never get into circula-
tion except as loans on which some
body is paying interest. Thus the
people had their money taken away
and had to pay interest on the bonds
and also on all the national bank
notes in circulation.> Not only that;
far worse was the sudden contraction
in values caused by this sudden con-
traction of the money volume in cir
culation. What the people paid in
this way for the whistle with which the
banking interests amused themselves
can never be even approximately esti-
mated. Nor l. # the first time these
retundinh operatlons< have been re.
:, sorted to in order to keep up the sup:
ply of bonds as q basis for bank note
circulation, though on account Of the
great surplus in theetreasury at pres.
ent the action of the! secretary oil the
treasury in: refunding the debt in:
stead Of paying II becomes : little
more fragrant than at anyssaformer
period. Il is, however, an. encourag.