The Birmingham age-herald., 1908-08-28
oosits follow Recommendations.

| posits follow accommodations.
 Then, too, there is a certain business advantage in depositng with a big bank It is worth something to be able to refer to big bank when ones financial stand ing is being investigated, and worth still more to have the advice of a man of large business experience when business enterprises are being considered.
 Besides these there is a social advant- age in being on good terms with the men who are prominent in the banking world surely the big banks prestige will be worth enough to it under the guaranty system; 1t should not begrudge the small CT banks the advantage which the guar anty of deposits will bring to them. 1 l cannot pass from this subject without referring to the fact that the big bank needs the guaranty as well as the little 1 one, for big banks fail as well as small banks, and the bigger the bank the great 1 CT the calamity to the community when it fails. No bank is so big to be ab- solutely beyond danger ana community needs protection against the big banks failure even more than against the fail ure of the small banks.
 Better Class of Men.
 It has sometimes been objected that the guaranty system would bring into the l banking business a lower class of men and reduce the average in character On l the contrary, the guaranty of deposits, 1 submit, would, If it made any difference l in this respect, bring into the banking l business a better class of men and raise, if that is possible, the average of char acter It is not to a mans discredit that | he Is not willing that one of his fellow l men should lose money on. his account. i Is 1t not mark of character that man should be careful of his good name and 1 considerate of the esteem of his fellows? At present a successful farmer or busi- ness man may be induced to take stock in a bank. It may be that his name is l desired to give standing and credit to the 1 bank, but such a man Is constantly haunted by the fear that bank official may be guilty of criminal conduct which will bring the bank Into insolvency. It l Is even possible that the banks assets may be entirely dssipated, and that the honest citizen, who has become a stock l holder, may either be compelled to go l beyond his legal liability meet the 1 bitter criticism of the depositors who have suffered by the failure. Would it not be worth something to the stockhold- 1 CT, in peace of mind to know that the maximum of his loss would be the value of his stock and the 100 per cent liability, and that no depostor could lose any thing? I am convinced that the guaranty i of deposits would not lead to degenera- ton in the personnel of the bankers.
 Advantages To Bankers.
 To justify a law guaranteeing deposit ] ors, 1t is not necessary to show that the i advantage to the bankers would amount 1 to more than the tax. The examination 1 of the banks would continue to be made ] at the expense of the banks. even if it were certain that the examination was of no pecuniary advantage to the banks. l The law would continue to require cer- tain amount of reserve to be kept on hand, even if it were certain that such | law brought no pecuniary gain to the ! bank: and so the banks ought to be compelled to insure their depositors against loss, even if 1t could not be | shown that such insurance would bring 1 compensating advantage to the bank
 The bank charter has a value; if it were not valuable the bank would not be or ganized. The bank charter is a gift from the people through the law, and the peo- pie who authorize the establishment of a bank have a right to demand in return that the bank shall keep the pledge which 1t gives when it invites deposits, and make good its promises of security
 to those who deal with it.
 But as a matter of fact, the banks will as a rule. gain more from the law than they will lose by the tax imposed by the law The experience of the Oklahoma banks shows this. The in terest collected upon the increased de-
 posits will far more than pay the losses occasioned by insolvency. But two banks have failed and the assets have in both cases been sufficient to
 reimburse the fund.
 Then, too the banks must remember
 that the question IS not merely whether
 depositors shall be made secure, but
 whteher the security shall be given by
 the banks tn emselves or by the govern
 ment through a postal savings bank.
 The refusal of the banks to permit
 the passage of law granting security
 to depostors is responsible for the growth of the sentiment in favor of the government savings bank, and the
 sentiment will continue to grow unless , something is done to satisfy the de-
 mands of the people upon this subject Postal Savings Banks.
 The republican party proposes the esta blishment of postal savings bank
 system; the democratic party prefers : the guaranteed bank because 1t IS pet z ter for the depositor and better for the bank er-lt gives the depositor the se- curity which he needs and yet leaves the banking business in the hands oi l the banks. But the democratic plat l form declares for "a postal savings 7 bank if the guaranteed bank cannot be 7 secured" and in November more than } 90 per cent of the voters will by their ballots demand either the guaranteed z bank or the postal savings bank Can