New-York tribune., 1908-02-15
MR.. LODGE ON FINANCE.
PREFERS CENTRAL BANK.
Ruf Thinks .4ldrich Bill Best That
Can Be Had Nosc.
rrrom The Tribune Bureau-l

on gold reserve and a complete eNuic'oii oi
all government credit paper are at TINS nioii'eN'
counsels of perfection from my point OF view
We must do the best that can be done under eA-
listing conditions / think this bill is the pest
; that can be done and has many Valuaoie pro
visions / believe it viii do great sooo' az"
,,a, n reflects great credit the high ability
Of the Senator who framed ii and who was con-
fronted by most difficult conditions 1t VIII
rard off such panic we have just seen. IL
lis not designed TO add to bank profits. but 10
heIp and benefit the country. and that most
thoroughly believe it viii do
Senator Lodge, replying to Senator Gay u
Georgia to-day. made the above profession VI
faith concerning the A1dTich bill and the nian-
cial situation. and in doing he probaniS eA-
pressed the view Of large majority OF the ne
publican Senators. So far as can be ascertalhea
no Senator regards the Aldrich bill as an ideal
measure On the other hand it is doubtful II
more than one Republican Senator will fail to
s,yrr,ort it. and that is MI Hepburn, of Idaho
Senator La Toilette. if his physical valuation OF
railroads amendment is defeated. will prohabiy
vote with the Democrats, as usual
Mr.. LODGES ARGUMENT
7, sdd;,,on IN the brief statement of his fnan-
csal faith. Mr Lodge said. in part:
] did intend TO be drawn into tnis ass ueDales
have thought several times duTing It's pIog peggafSS
Of z which was Toll cl ltlt Adte s,S--e''N-
Vsnce whom many Of us remember. When.
GOOD many years ago. there was one OF our eleat
nssEs or sTeT Senate Vahce went down TO
North Carolina. and at large meeting. where ne ne
said: I have come before you discuss this
s be dnF 10 snes h1 pnops
with which entirely familiar Is that it taxes fa1
that that was a very frank and honest confession
great many of us possess. But. Mr. President,
although j am moi a financial EXPERT know
somewhat more believe. than Senator vance ad-
mitted. and I desire to go little bit further than
his statement would carry me
various Quarters S Of sneiai beef Especially from
the Senator from Georgia and ] also should like
the Opportunity to make my confession Of faith
should be very glad TO see every dollar of gov
3 Dollar Of government notes afioat / should Ike
10 see the government confined TO coming gold and
receipts against them. ! DO not believe in the gov
naS 3s how N the es soRnn a @ ape2 G ot oEt
after il has printed IL unless either lends 1t or
put # out The one method is pure imitation. the
other is entering upon the business of loans and
discounts. which no government should touch.
q. not believe IN the creation Of money in order
way toward imitation, 90 not believe the govern
trent should be in the business of lending money.
should control banks unquestionably. and all gov
srnn1ents do hecause every government must hold
creation OF money being necessarily function of a
sovereign government
cRlTIcTsES BoND-SECURED CURRENCY
ISSUED by banks issued against a@gold reserve
which, 1 think. is the sound business method. /
scientific method Of issuing currency. 1t no doubt
ought now to SUBSTITUTE for If 6df1ea we
Your bonds sell at an extravagant price and are
growing more and more inadequate as basis of
circulatioE: The bonds of the governplent which
SAYINGS of the neone of oosi ne Investment Of the
bring fancy prices because the hanks need them
All the objections which made to the pending
hill because of the use Of bonds secure crcuIa.
Ton Of The national banks ''' Tie eifcnia-
1 must we afgs ae the TO bond % red circulation
cf that circulation. or we shall strange business
pared and wish we were 10 get rid Of = bp'd pie
secured circulation and substitute one based upon
are going 10 retain . bond-secured circuIatjo1
posed by this bill Ne must give II as IS PRO-
elasticity Otherwise you making a currency
osneers Of just such panics as had last au-
tumn-
! should Ike. as have said, to see banknotes
secured on gold reserve should Ike have
entiflc and proper way 10 do it would he have,
central bank Of issue; like the other great com
as those banks are controlled. by the government
believe the system of England and France
and Germany is the sound system of currency. Civ
elasticity. thus relieving from the rigidity Of
the bend circulation and separating the govern
II is one Of the serious objections TO our large
has to ed to the banR and n so an to nqr1 1h neD
Let The banks do the banking business and let the
by the Constitution I hone that the government
~ ~ a1 IT, any s lrcunstances enter on
e ~ see th sRss @ O S1eg1 PAPER and should
still left taken out of tire circulation
Mr.. CLAY ATTACKS ALnRICH BIIJ.
Senator Clay declared that the A1drich bill
WAS wrong and vicious. and would give no relief
20 the South and West He contended that il
merely enlarged the powers Of the national
sovereign right 10 issue and circulate money.
which il never ought 10 do The plan Of the
minority in the Senate for the government to
!ssue $500, o0o 600 Treasury notes and use them
in paying the expenses of the government. that
they might find their way into the channels of
trade was advocated by him
IF the Aldrich bill bcomes law" he said. the
government guarantees the redemption in gold
Of the additional notes issued by the national
banks. Would not this be great a strain on
the gold reserve as Treasury notes.
State, city and municipal bonds of the South
and West he contended, were now being held by
Eastern capitalists. and the South and West
could not obtain any additional circulation bv
making these bonds 2 basis of circulation as
they ha6 already beer sold in the East He
declared that the class of railroad bonds men
toned in the Aldrich bill applied solely to the
railroads In the East. and that the roads in the
South and West had paid dividends as
provided in the bill. The bill. he said was
drawn in favor of the rich and powerful. enab-
ling them to control the money issue. and it was
not IN the interest Of the American people Mr.
Clay became involved in a heated controversy
with Republican SenateTs