The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1906-12-24

objection to state and government
supervision, and, possibly, even neces-
sary. paternalism-
For example-the capital belongs
to the shareholders. who control It
through such directors as they may
elect. But a bank must have deposits
Who owns the deposits? The public
Who represents them? The legis-
lature. Does 1t not seem perfectly
fair that the people who own the
larger part OF the assets of most banks
should say, through their representa-
tives, Here, Mr.. Banker, you may use
our surplus money to your profit, but
for our protection, you must set aside
a small proportion Of the earnings for
a guarantee fund, Of which the state
will be trustee Is that paternaiism
Is it not rather simple justice and
right to the depositor who practically
has but little to say about how his de-
posts are cared for All business
would be paralyzed without the de-
posts of the public now in banks, and
there is no comparison whatever be-
tween bank and other credits. Bank
credits belong to all the people;
storekeeper's credits belong to him.
He controls only his own and If he
sells his own goods to bad people on
credit. and loses them, he alone is at
fault. Objection No z is foolish.
collector No 3 thinks, 1t would
cause the organization Of too many
banks, and under such a plan, deposit
would
good and bad bankers To this. ]
may answer, first, that the law of sup
ply and demand would regulate the
mum Der of banks, and, second, deposit
tors do not discriminate much now,
not even bankers themselves, In chOOS-
ing their repositories. / do not think
there is much force to the objection.
1t is almost impossible for a large per
cent of the people to know a good,
safe conservative bank from the bad
one. There is some justice in CHASING
and judging us as class. The pro-
lection between the depositor and his
money is the capital. the managers
and the state. The people must de-
are not asking too much when they
request it to compel the banks to
make assurance sure by a guarantee
fund"
Mr.. Brokaw says in conclusion:
If the published statements of a bank
revealed its true conditions; if like a con-
known; if. like a bad man. its character
were apparent there would be no excuse
would be alone to blame for doing bust |
ness with bad concerns and would deserve /
ers know that our published statements |
reveal but little We know that often the /
Of a bad bank seemed to be all right /
it was in fact only a 'whited |
monument. filed with dead assets.'
'4All will agree that the most unpleasant !
feature of the banking business is the dis /
trust on the part of the people. caused by |
the unexpected and occasional failure or |
banks thought by all to be sound and |
good.
"A wise guaranteed deposits law would
remove that difficulty. It would bring out 4
from hiding places millions of money. 1t /
would largely If not wholly prevent pan
cs Could there be a banjo IL the indi- |
vidual deposits were safe, If the reserve |
deposits were safe, If the central reserve /
deposits were safer
Postal savings banks would be safe.
out would take millions of deposits away /
rom commercial banks, never to be in 4
vested in commercial business. Do we
want them?
THE interests of the people are surely
greater than those of any class, even so
good a class as bankers, and your and /
ny personal ambitions must be subser-
,ient to the public good
ITO deny the principle Of guaranteed de-
oosits is to deny the principles of insur-
ince.'