The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1906-12-12


listing treasury system and its manage
ment, the drawbacks to which are so
forcbly illustrated by the present stu
alton in the money market.
Under the law the revenues of the gov
eminent have either to be covered into
the treasury or they may be deposited In
part with the national banks at the in
stance of the Secretary of the Treasury.
This immense discretionary power has
been exercised by successive secretaries
with varying prudence and ability, and 1
should add in the forty years of my own
experience no secretary of the treasury
has shown in this respect more common
sense and foresight than the present occu-
pant of this high office. But it cannot
be expected that the judgment of a single
mind can be infallible and placing, as is
the case, into the hands of one man the
power to be the arbter of the material
welfare of the entire country, this, with
the best intentions. through the least
error of Judgment on the part of the
Secretary of the Treasury, may become
jeopardized to a degree, the extent of
which we shall never be in a position to
ascertain.
Are Not Good Financiers.
Nothing is so greatly to be deprecated
than the ever-recurring withdrawal of a
large part of the countrys capital from
its useful purposes into the United States
treasury and the so-called assistance to
the money market by the Secretary of
the Treasury with this necessitates. The
overnight announcements of relief the
Secretary Of the Treasury is in the habit
of making are neither good finance nor
fruitful of good results to the material
interests of the country; but these sud
den announcements from Washington to
which we have become accustomed are
only the consequence of most undesirable.
almost barbarous methods, which existing
laws have called forth. The sole but i'm
perative remedy for this is the enactment
of legislatin providing that the revenue
of the government, which after all are
nothing but part of hte working capital of
the country, shall, as fast as they are
collected be deposited with the national
banks In proper proportion to their capt.
tai, upon such actual security as may be
acceptable to the Secretary of the Treas
ury and upon the payment of a uniform
rate of interest, likewise to be determined
by the Secretary. If this be done the
country will at all times understand what
it has to deal with, without having to
look constantly Washingtonward to de-
pend upon single man and mind for the
regulation of the money supply. With a
sound elastic circulating medium, and the
situatio notherwise left to natural con-
ditions, trade and commerce will find it
self protected against many of the finan-
cial difficulties under which we suffer
at all times to a lesser or greater degree
not less in the periodical uperabundance
of money than in times of severe scar
city or in the panics which came upon us
at greater but certain intervals.
Not until these conditions become rene
died will the United States become finan-
cially and commercially Independent and
supreme, a position which our natural
resources, as well as the energy and abil-
ity of our people, should long ago have
assured us. Who can compound the ac-
tual losses and moral setbacks we have
suffered since the close of the civil war,
because of our clumsy and deficient finan-
cial methods? Had we then set our house
resolutely and properly in order, instead
of continuing and inventing all sorts of
makeshifts, which at best act but as pal
liatives. who knows how much suffering
we might have been saved in these four
decades? We have during this period had
not alone two financial panics of the
first magnitude, with some ten years of
enervating depression Immediately follow
ing the panics of 1873 and 1898. but have
moreover DeeH UNABLE as a nation 10 gam
the International financial leadership,
which has been several times within our
grasp ! can only repeat, 1t is by no
means the banker who suffers under the
prevailing conditions, but rather the man
ufacturer, the farmer and the merchant
You know not today, what in q monetary
sense, the morrow will bring; you base
the initial arrangements for your bust
ness affairs upon ordinary financial con-
ditions and before you get through you
are compelled to pay exorbitant rates
for the accommodation you require, IL
you can obtain 1t at all. Instead of
possessing a circulating medium which
can adapt itself to the business of the
country. the business of the country
has, as it is. to adapt itself to clumsy
currency and consequences are naught
but loss, setbacks, If not panic and
repulsion. Let me. however, not be mis-
understood. Elasticity must be the prime
quality of any credit currency, more so
even in its contracting than in its ex-
pansve possibilities. The seed for finan-
cia1 trouble Is not laid in times like the
present, when money is scarce and finan-
cial accommodations difficult to obtain
Financial difficulties are bred when money
is superabundant, when with existing laws
and prevailing methods, the banks are
unable to withdraw with their circulating
notes, though they may not have the
least use for them, while at the same
government deposits retained by the
banks who have no good motive to re-
turn these, as they cost nothing. 1t Is
in such times of choked money supplies
that unlendable funds become employed
for the promtion Of every kind of illegiti-
mate enterprise from which It is found
impossible to withdraw them. when they
become needed for the legitimate require
ments Of commerce and trade Against
these evils. currency reform and reform
of treasury methods are to protect us
and because Of this our first care in
creating a credit currency should be TO
make it thoroughly responsive not only
to the requirements Of commerce and