Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1906-11-22


the treasury department. has been en-
phasized by the recent action OF the coun-
tryB greatest commercial body, the cham
Der Of commerce Of the City OF New YORK.
and the country's most important banking /
body, the American. Bankers association, /
who tointly, through representative men /
81 high character, wide experience eXten- |
Btve research and practical knowledge, /
soys iS}Tqieted ana PTSS ioS &C. pan
liked into law, Il Is believed will remedy /
existing defects in our treasury and cur |
eral good. 1 accept the Judgment of these |
men az sound and the principles enun- /
eisted az a basis Of legislative enactment |
az being as nearly correct az is possible |
under conditions where ideals cannot be /
attained and perfection cannot be had. II |
might better accomplish results more sat |
isfactory, but a great central bank is an |
i,mnpossiollity in this country where pc
individuality in every part of the country
Will not surrender Itself to concentrated !
power in the field of banking no matter |
how carefully such power is dealt with or
how perfect and beneficial might be the
result OF its use. The legislation that IS
the most nearly perfect and improves ex-
listing conditions and remedies present de-
fects must commend itself as practical
thing and the country can better afford
to take the nearest approach to the best
thing than TO wait stlll longer years for
legislation without defects and enact
ments that are beyond question in every
word and line.
The commission which sat at Washing
TON unQeT authority or tho CnanDeT OF
commerce and the American Bankers asso-
citation proposes legislation which will
emasculate the subtreasury system and
place the banking business OF the govern
nent of the United states upon the Same
rational and common sense lines as is that
of the banking transactions of the man
OF everyday affairs, that of every state,
| county and municipality in the country.
| And why not? The government method
| or banking Its receipts OF revenues is the
| irrational method which, II followed by
| the individual, would spread disaster
| everywhere and make daily business i'm
! possible 1t converts the dollar of activ-
! ity into the dollar Of idleness, and takes
out of the channels Of trade the force es.
business undertakings As long as the
: nation takes, through force OF law, from
the individual citizen more than the gov,
eminent needs for legitimate governmental
purposes, 1t ought, in justice to him, at
least, attempt to minimize the wrong lt
innicts in permitting the business world
J of the daily use .of-the surplus revenues
which are accumulated. The wrong ts
/ doubly inflicted when the citizens capital
| is directly iessened on the one hand and
| indirectly injured on the other. II on rev
enues deposited in the banks by the secre-
can be no complaint about such deposit
nor charge of governmental favoritism;
1t, too, will put an end to the continual
| appeal to the secretary to aid the money
| situation, for day by day the government
| will bank as others bank and all will know
| what the conditions are and not dwell IN
| continuing expectancy Of relief being
! granted. from Washington. 1t is unfair
| both to the secretary of the treasury, no
matter who he NAV be, and to our bust
ness undertakings, no matter what they
are, that the law should necessarily create
so close an intimacy between the two
Under trying circumstances Secretary
Shaw has conducted the duties or mis-
great office with rare skill and judgment
but IL would be infinitely better to make
the appeals in every trying time an i'm
possibility, and such a thing can only
come about by either the complete abolish
ment of the subtreasury system or the
| rendering of IL an inconsequential force
in monetary movements.
1 wish now to turn TO a discussion OF
that which constitutes the more important
provisions which this commission on be-
terests of the country will ask congress
TO enact into law, namely the enldtgng
OF the note issuing function OF national
banks by granting them the right, under
wei conceived and conservative restrlc-
J tons which assure. safety to the public
.. the power given, to put forth promissory
notes OF small denominations without a
. specific deposit of assets to secure the
same. / am aware that there are many
both in and out of banking circles who
; either doubt the wisdom OF such note
, They take counsel Of their fears and
fortlty themselves by barking back 70
periods where conditions existed which
The era Of wildcat money has gone by
as effectualy as has that OF the irrcdeeni-
able greenback fallacy, and the silver
heresy The world of business has moved
= on to more intelligent periods, better de-
vised monetary and currency methods and
2 a saner understanding Of bank note values.
: No one complains OF the absolute good
n ne,,Sd Of H. present bank notes They are
Il. no relation In volume or activity 10 the
varying wants Of business conditions
y Of the price OF government bonds as re-
= hected by The daily quotations. It is
Il absurd to contend that such bank note
i issue is scientifically correct or can posi-.
= bly, adjust itself to the business growth
Of an expanding country. We car better
. which research and experience proves
I fundamentally right than go on with
: regard are inadeduate and wrong in every
u other respect 1t seems to me that We
= have reached point in dealing with cur
. TO try and reach conclusions through al
: lnteilgent analysis Of the facts as they
/ or Wish they were: There is no doubt
but that ultimately the knowledge Of what
constitutes the Underlying principles OF
q free our minds OF many misconceptions
: that both hamper and confuse us. / an
- sure the public will at no. distant day &C.
e cept as automatic the fact that bank note,
{. are nothing but mere promissory notes
y sure the public will at no distant day &C
n cause they are rcdeemable upon demand IL
!. that which has recognized value. The!
II are no more money than bank checl
II money and are redeemable in money.
{. But the argument is advanced that th'
r pIopoSeu unsecured Dank note suggested Dl
=, this commission will become the means o.
q an imitation OF our volume Of currenc!
10 which Will encourage speculation on ever!
N hand and work out panic and disaster.
: challenge the objection thus made as un
y sound because imitation never Gomez
through an issue or notes which are uuickl,
convertible on. demand, with redemption
= agencies near at hand, and where the none
tary standard OF value upon which sucl
notes rest IL not debased. The fnnation 0
d currency comes from debasinR Of q coun
try's monetary standard OF value and neVe
from the issuance OF convertible bank notes
D And Il IS equally true that speculation bea r
z no relation 10 the putting out Of cnnvertibi
bank notes, but finds its birth and groWt
= and final development In the unwise- an,
p abnormal extension OF bank credit, ae tina
1t credit is represented by check ana deposi
Today there is no adequate means in thi
10 country, outside OF artificial ana Immature
Is ones, OF meeting the changing needs o
- business requirements. The granting not
n and then OF government deposits mean
Id nothing under existing conditions. In ever,
d season OF extraordinary crop movement O
r manufacturing activity the banks I'M
N themselves either unable 10 properly prO
e. vide credit TO THOSE who deserve Il, or /
Is they DO 50 the strain Is so great as L
Is cause such high rates OF interest as TO la,
lf an added burden upon every customer
IS The banks assets, no matter how good
h are dead insofar as being available 70
a purposes OF relief Of a situation whic
te ought without dflculty TO be corrected
" They cannot discount their paper WithOu