New-York tribune., 1906-12-15
REJECT BANKERS PLAN.
NO CREDIT CURRENCY.
ongress, HOrerFr, Nag Enact
Some Remedial Measure.
IFrom The Tribune Bureau.

Washington, Dec. 1.-THE credit currency
plan formulated by the American Bankers As
sociation I'm it's convention in Washington last
month will not be adopted by Congress at this
session. nor will IT find an easy road TO adop-
tion for some years 10 come. When the plan OF
the bankers was first made public an unofficial
statement appeared which credited Secretary
Shaw with criticising the plan on the ground
that the first proposition provided for the issue
of any bank meeting the required conditions ot
credit currency equal 10 per cent of its
bond secured circulation subject to a tax OF 2ts
per cent year on the average amount outstand-
ing Such a circulation. according TO the news
paper reports of the Secretary's views. would
not constitute an emergency circulation. as was
asserted for ~ because the tax was not sufs-
GENTLY high TO insure It's retirement as soon a.
the emergency had passed on the contrary.
bank issue subject to tax OF only 21a per cent
might easily remain in circulation throughout
prolonged period of prosperity. when interest
was high. and might thus be absorbed into the
permanent circulation. and serve merely 20
initiate the volume of currency rather than add
that elasticity the need of which Is felt at nor
infrequent but usually for brief periods
Mr.. Shaw is also credited with saying. about
this time. that mo new and unguaranteed form
of money should be injected into our SYSTEM"
But later the Secretary made an official state
ment I'm which he said: THE Secretary will be
pleased beyond measure If Congress VIII adopt
every detail of the plan recommended by the
recent committee OF bankers and business men,
What led Mr.. Shaw apparently radically 10
change his views is not known. but that the un-
official statements credited to him are dn far
greater accord with the views OF Congress than
those expressed In the official statement quoted
is unquestionably true.
Congress will not enact legislation providing
for an addition to the present system Of any
credit circulation: neither will it make any pro-
vision for emergency currency which might
easily be converted into a practically permanent
addition TO the circulation, and thus utterly fail
of the purpose for which 1t provided These
statements are made with the utmost confidence
In their accuracy.
1t is possible that some plan will be forYnu-
lated and enacted into law at this session by
which such emergencies as have recently oc-
Cured and which have led the Secretary of the
Treasury TO believe IL necessary TO advance in
terest. retire bonds. etc. to relieve financial
stringency. may be Obviated. but IL this is ac-
complished it will not be along the lines of the
plan of the Bankers Association and It will rot
be a resort to credit currency
James b. FOrgan president of the First Ma
tional Bank of Chicago. and A. b Hepburn
president OF the Chase National Bank OF New
for the adoption OF the bankers scheme. but
have not met with much encouragement In a
general and non-cOmmittal way the Speaker has
talked of the lack of time at a short session and
the great amount of work attendant on getting
the big supply bills through. Senator AIdrich
chairman of the Finance Committee has asked
some pertinent but abstruse questions of Messrs
Hepburn and Forgan. and they have returned
10 their homes little encouraged over the situa-
ton
Nevertheless. the who do things IN Con-
gress are really cudgeIrg their brains and IL
Is possible that some measure calculated to
prove remedial I'm fits operation Will be devised.
If this be effected the details carefully
worked out and the leaders OF the minority as
we'll as the majority satisfied that IT Is a wise
measure. so that IL can be passed quietly and
without much debate it will be DONE If It IA
not possible do all this and If the scheme
devised excites opposition and likely to
provoke debate # VIII be abandoned until the
next session Of Congress
The Bankers Association has done good by
emphasizing the necessity OF remedial legisla-
ton The President has done more IN this di-
rection by congratUlating Secretary Shaw on
his ingenuity IN meeting emergencies. but the
framing of the legislation will be performed by
that small coterfe in the two houses of Congress
popuIarIy known as the financial sharps." and
only when they have worked out every detail
and the respective committees practically
ready 20 report bill Will the provisions OF the
measure come to light And whether that WIN
be this session or next will depend almost en-
tireIy on the success of the -sharps' IN -greas-
ing the ways" for the launching OF their con-
templated measure.