Waterbury evening Democrat., 1907-12-03
PAGES IT TO 20.

ot rnelr capital in notes of given kind, the issue to be taxed at so high a rate as to drive the notes back when not wanted in legitimate trade. This plan would not permit the issue of currency to give banks additional profits, but to meet the emergency pre- sented by times of stringency.
 T do not say that this is the right system. I 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 possi- bility of discrimination and favorlt- ism. Such 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 it's 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 a 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 Ancn 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 6 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 1t guards the interests of New York or Chicago bankers and must be drawn from the standpoints of the farmer and the merchant no less than from the standpoints of the city bank CT and the country banker"
 I again urge on the congress the need of immediate attention to this matter. We need a greater elasticity in ou: cur rency, provided, of course. that we rec ognize the even greater need of safe
 
 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. It is worth Investigating to determine whether officers and directors of na- , 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.
 Yet we must also remember that even the wisest legislation on the sub- ject can only accomplish a certain amount. No legislation can by any possibility guarantee the business com munity against the results of specula- tive folly any more than 1t can guar antee an individual against the results of his extravagance. When an indi- 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 accompanied by dishonesty, they jeop- ardize not only their own future, but 1 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 a most satisfactory condition. For the six fiscal years ending with the 1st 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 $3.465. .000,O00 and ex- penditures $3,2T5,OOO.OO0. The net ex- cess of income over expenditures. in- cluding in the latter the S50!0O0.00O ex- pended for the Panama canal. was S190.O00.000 for the six years, an aver age of about S31 1,0o0,O00 year This represents an approximation between income and outgo which it would be hard to improve. The satisfactory working of the present tariff law has been chiefly responsible for this ex- 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.