The Washington times., 1903-07-28
NEW CURRENCY BILL,
TO, avert ATTACK

pOrated in the new measure authorizes
the Secretary OF the Treasury to deposit
In national banks the receipts from the
collection Of customs as we'll as inter
nal revenue receipts Only the latter
is allowed under the present law
The receipts from internal revenue
collections average about $500 900 a day.
customs receipts vary, but are generally
more than S1,0o0.000 a day. Under ex-
listing law, customs receipts are depos-
are only drawn out for payment of ap-
propriations made by Congress. This
causes a constant blocking up OF cur
rency taken out of the channels Of trade
and creates a condition which has al
ways been objected to blythe business
interests Of the country.
The scarcity of money In trade circles
in times when crcPs are moving and
when demands of a similar character are
inSstent constitutes a serious handicap
to business interests generally Every
day means the withdrawal from trade OF
about $1,000. 00o. and the Secretary OF
the Treasury is compelled to resort TO
unusual means to remedy the money
stringency.
Railroad Bonds as Securities.
Another feature of the Aldrich bill
gave to the Secretary of the Treasury
authority to accept as security for Gov
ernment funds so deposited. State. mu-
nieipal, county. and high-class railroad
bonds, as well as Government bonds
The railroad bonds acceptable under
the provisions of the bill were limited
10 roads which paid a dividend Of nor
less than 4 per cent uninterruptedly for
ten years As matter of fact that class
or bonds is not held by national banks
Few railroads went through the panic
or nine years ago without passing a df-
vidend. The bonds of the roads which
come within the limits OF this bill are
gilt-edge, and worth more than Govern
ment bonds
Extension of Present Holdings.
II bonds of this class were held nv
banks they could not afford to use them
as basis OF circuIs:ion or nut one of
them up as a deposit TO secure 500
worth OF money. Consequently any op-
position created against this feature OF
the bill. on the grounds that eornora-
uon securities should not be taken as
security Tor Government money is
tnought 10 be Illogical. 1t is a feature
VI the Aldrich bill which is quite likely
10 De dropped. however. in the neyy
measure -e"
Under the new bill the Secretary NJ
1he treasury will be permitted to con
tIhue the policy OF accepting State and
iuuhlclp2l ponds as security for Govern
ment deposits. The Government nov,
hoids about 10000. 900 worth of these
ponds. and there is great opposition in
soee quarters to an extension of that
pollcy: Onder proper restrictions Il Is
conceded that N risks would be taken nv,
the acceptance OF bonds. Many details
remain 70 be worked out. such as the
kind of bonds that should be taken and
these are among the problems before the
special committee.
A Taxable Asset Currency.
Provision for asset currency is made
in the new measure. and this is a feature
which had not been Incorporated in the
Aldrieh bill Senator Aldrfcb beItavos
the proposition should be worked ont In
separate measure II at all but the
sentiment in the House makes IL neces.
sary TO combine all currency legislattoo
IN one bill. The details OF the plan have
not been perfected. but the idea is TO
allow banks TO issue circulation uD %
ABOUT 90 per cent OF the capital stock and
put a tax on circulation, so issued. OF
about per cent
An increased circulation Of this char
acter would only be Issued in times of
eIueI gehcy such rs is annually caused
IN the fall Of the year by the moving 1f
crops When the need for asset cur
rency su55ided IL Is believed that AZ
would be driven into retirement bv the
tax Thus the measure would act auto
matically, expanding the currsncy when
money was needed and contracting when
that time had passed.
Questions Not Yet Settled.
Several matters connected with the as
set currency proposition are under con-
sideration by the committee. For In
stance. II is proposed 10 permit the issue
OF not more than % per cent Of the cant
tai stock Of the bank The rate of fav
is another matter not agreed upon bv
members OF the committee. While the
majority think per. cent would be bign
enough several members Of Congress
who have been interviewed want A higher
rate Some suggest 4 per cent and Others
5 per cent. The question to be deter
mined is whether the high rate would
defeat the purposes Of the bill when ad
ditonal circulation was needed and
whether the low rate would fail to re-
tire the additional currency when the
demand decreased
Many other Issues OF importance in the
program for financial legislation have
been before the committee but these
it is believed. will work out satisfac-
torily. When the committee began work
several months ago the situation was
greatly obscuTed by conflict Of views.
but there is prospect now that the An
gust conference will produce a completed