The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1908-01-16
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STATE pdHKS an advantage unless /
strengthened the confidence of de
positors in them; and is it possibl,
that the state should for any reason
withhold from 700 of it's own institu
tons any public confidence which thu
law can confer? Suppose congress
should pass a law for the exclusive
benefit of national banks. In wha
ma themselves? Is not our propo'
sition far more just and fair, mas
much as it proposes to admit nationa
as well as state banks to participate
in its benefits? have direct infor.
nation from the comptroller, bear
ing date of January IS, that the right
of national banks to participate in q
state guaranty law has not been decid.
ed and that no ruling of this kind has
been made by the comptroller OF the
currency, and l have received long
letter, under date of January IL, from
ex-Comptroller Dawes, favoring this
guaranty proposition 1t is my desire
that both national and state banks
shall equally share the benefits, and il
goes without saying that any law en-
acted should contain this provision
Let the participation under this law
be voluntary, but let it apply to all
banks. both national and state.
Answers wildcat Arguments.
The necessity for immediate action
in this matter, creating an emergency
alone justifying this extra session, In
addition to the financial considerations
discussed above, is found in the fact
that our sister state of Oklahoma has
enacted depositors' guaranty law. to
take effect in q few weeks jeOpardizing
the deposits of many of our border
banks and indeed many of our interior
banks, as these bankers themselves
write me. Prompt action on your part
for their sakes seems imperative.
Some plausible and sincere objections
are urged to this proposed law, but I
must be pardoned for believing that
none of them will stand the test of a
careful analysis. Nearly all Of these
swered by eminent bankers and fnan-
ciers. The chief contention Is that
guaranteeing deposits will put poor
bankers and good bankers upon COM
mon level and make the good response
BILE for the bad; that it will multiply
banking methods. 1 think it would Go
the very reverse Of this. 1t would make
such a community of interests between
the bankers that they would help to
see to 1T that every needed safeguard
was thrown around the banking buSi-
ness. that all loose methods were eliin-
mated. and that the banking laws
would be sire ngthened in every possible
way because it would be to their In
terest to do so The good bankers often
know when bad methods are being en-
ployed by other banks, and would see
to it that these practices were stopped
by promptly inforrning the comptroller
or bank commissioner. They often pos
sess a knowledge which the ordinary
citizen does not possess, ana under TINS
new system it W ould be to their interest
to use this knowledge for mutual and
common good. This new att1tuoe o,
the bankers themselves, which would
be brought about by the law, would in
itself be a strong safeguard against any
wildcat banking. But. in addition to
this, further safeguard has been sug-
gested. which seems to me eminently
wise. by providing in the law that all
deposits drawing over three per cent
interest-or any other fixed per cent
which YOU may think wiSe-Should not
be protected byIsthis guaranty fund.
This limitation would prevent the wild
cat banker from taking fnterest-bearlng
deposits away from his competitor by
Offering a higher rate of interest than
his conservative competitor would give.
In addition to all this, this knitting
together of banking interests would re-
suit in demand upon the part or
bankers themselves for the eradication
of many present abuses OF the panklng
system. Including. I think, the borrow
ing of large sums by directors and OIL
GERS from their own banks, the organic
alton of an unlimited chain OF banks by
one individual, and would result also
in more frequent and thorough 1nvesl-
cations Of banks and banking netnoos;
The urgent demand for this. law and
for the calling of this special session
10 enact 1t has come to me from every
mart of the state and represents every
business interest. One petition alone
from Wichita contains the names OF
wholesalers and jobbers exclusively
whose annual business aggregates be-
tween fifteen and twenty million dol
lars. Merchants and manufacturers
have Joined in the demand. while the
farmers and laborers are equally in
sistent.
The people want this law, and to fail
TO mass 1t at this time is by no means
to settle the subject. 1t would only pro-
long the controversy. 1t would project
it into the coming campaign to be dis
cussed in all of it's phases from every
stump to the disturbance OF business
and to the detriment of the banks. l
beg YOU to pass this law for the bene-
fit of depositors, bankers, and AL forms
of business alike.
The Railroad Problem.
Perhaps no state in the Union has
nut upon its statute books in the last
three years as many laws In the inter-
est of the people in their relation 70
state of Kansas. And it is significant
fact that in all of my vast corre-
spondence in relation to this extra SEES
sion of the legislature not single
letter or telegram has been received
asking for additional railroad legisla-
ton. The enactment of the antipass
law by the last legislature, the ma
terial strengthening of the railroad
law by that body, the enlargement of
the powers of the board Of railroad
commissioners, the liberal appropria-
ton made for the enforcement of its
the putting into effect of a
two cent passenger rate since the ad-
journment of the legislature, and the
preparation by the board of railroad
of a carefully consid-
cred freight rate schedule. seems to
have satisfied the people that the ad-
ton means to do everything
possible to protect them against cor
porate injustice and greed. The inn
portance of this freight rate subject
can not be OyereStimated. 1t is of i'm