Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1907-12-03
REPUBLIC is SOUND, SAYS PRESIDENT IN MESSAGE

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currency TO give banks additional
profits, but TO meet the emergency pre-
scented by times of stringency.
Il do not say that this is the right
system. l only advance it to empha-
size my belief that there is need for
the adoption of some system which
shall be automatic and open to all
sound banks, SO as to avoid all posi-
bility of discrimination and favorit-
ism. Such a plan would tend to pre-
vent the spasms of high money and
speculation which now obtain in the
New York market, for at present there
is too much currency at certain sea-
sons of the year, and its accumulation
at New York temptS bankers to lend
it at low rates for speculative pur-
poses, whereas at other times when
the crops are being moved there is
urgent need for large but temporary
increase in the currency supply. 1t
must never be forgotten that this ques-
ton concerns business men generally
quite as much as bankers. Especially
is this true of stockmen, farmers and
business men in the west, for at pres
ent at certain seasons of the year the
difference in interest rates between the
east and west is from to 10 per cent,
whereas in Canada the corresponding
difference is but . per cent. Any plan
/ must of course guard the interests Of
western and southern bankers as care
| fully as it guards the interests of New
York or Chicago bankers and must be
Il. +Io Di,tc fl,1n
| farmer and the merchant no less than
| from the standpoints of the city bank
| er and the country banker"
again urge on the congress the need
| of immediate attention to this matter.
We need greater elasticity in our cur
| rency, provided, of course, that we rec
| ognize the even greater need of safe
| and secure currency. There must al
| ways be the most rigid examination
| by the national authorities. Provision
| should be made for an emergency cur
| rency. The emergency issue should
of course be made with an effective
| guaranty and upon conditions care
| fully prescribed by the government.
| Such emergency issue must be based
| on adequate securities approved by the
government and must be issued under
a heavy tax. This would permit cur
rency being issued when the demand
for it was urgent, while securing its
| retirement as the demand fell off. 1t
| is worth investigating to determine
| whether officers and directors of ma
tional banks should ever be allowed to
| loan to themselves. Trust companies
| should be subject to the same supervi-
sion as banks. Legislation to this effect
should be enacted for the District of
Columbia and the territories.
| ct we must also remember that
e,e en- the wisest legislation on the SUBJ
ject can only accomplish certain
amount. No legislation can by any
possibility guarantee the business COM
tmGnrty aga1nst tffe 'fegsnfrts Of specuia-
tive folly any more than it can guar
antee an individual against the results
of his extravaganza. When an indf-
vidual mortgages his house to buy an
automobile he invites disaster, and
when wealthy men or men who pose as
such or are unscrupulously or foolish
ly eager to become such indulge in
reckless speculation. especially If it is
/ | tlShOilGoly' JIob-
ardize not only their own future. but
the future of all their innocent fellow
citizens, for they expose the whole
business community to panic and dis
tress.
| Revenue.
, The income account of the nation Is
, in most satisfactory condition. For
the six fiscal years ending with the
, LIST of July last the total expenditures
and revenues of the national govern
ment, exclusive of the postal revenues
and expenditures. were, in round num-
/ bers. revenues So, 465. 900, 900 and ex-
penditures 100000. The net ex-
cess of income over expenditures. in
Guiding in the latter the S5O,000.000 ex-
pended for the Panama canal, was
S190,O00.000 for the six years, an aver
age of about S31 100000 a year. This
represents an approximation between
income and outgo which 1t would be
hard to improve. The satisfactory
!. working of the present tariff law has
: been chiefly responsible for this e1-
cellent showing Nevertheless there is
an evident and constantly growing feel
ing among our people that the time is
: rapidly approaching when our system
of revenue legislation must be revised