The Washington herald., 1908-02-11

Before "A large audience which gave
him close attention for the entire pc
riod of his effort. Senator Aldrich. OF
Rhode Island, chairman of the Senate
Committee on Finance, delivered in the
Senate yesterday afternoon q speech on
the pending currency measure. which
reviewed in detail the recent and pres
ent financial conditions. the reasons for
the adoption and the arguments for his
bin. and the objections urged against it,
Nearly every Senator was IN his seat
when Mr. Aldrich began. and all re-
manned until his remarks were con-
c,dded, when his associates crowded
around him to offer their congratula-
tons
Ia spite OF the Infamlliarity which
most OF them must have felt with the
subject the several hundred spectators
in the galleries showed intense inter
est, ana seemed 20 follow intelligently
the clear, simple, direct statements of
the chairman Of the Finance Commit
tee
o. Pierpout Morgan sat iu the re-
served gallery, and gave Senator AID
rich his undivided attention,
In the course Of his address Mr. Aidrich
pointed out that the Treasury was not
likely % bee ia a condition To increase de-
posts in national hanks. and he adj
N0cated "a large curtaiimont OF these
funds. IL another financial crisis came
men Of patriotism. courage. and capacity
might not Dee found again 60 render such
conspicuous and Invaluable service as was
given In tie recent emergency. Mr.
Aldrlch asserted that tie suspension ol
bank payments would not boz tolerated
again. lie made "a cheering reference O.
present conditions and expressed conf
dence that the prolonged period of de
preston which followed the panic OF four
teen years ago would be avoided, and that
there viii De soon Il great excess of cur
rency. probably a surplus OF loanahl5
capital
No Central Rank New.
Personally" said senator Aldrich, in
referring 10 the plan for central bank
4 believe that this country is IN time
likely 10 adopt such a system. but
agree with the members of the commit.
tee that the adoption Of It at this time
OF in the near future is out Of the ques
ton"
or the bill which he advocated. Mr.
Aldrich said that it proposed 10 prevent
panics and furnish the means Of relieving
panic conditions, but it was not claimed
that it was "a panacea for all financial
MS and il made no pretense Of providing
a new monetary system or of trying q
new experiment with the currency. II.
purpose, he explained, was 10 give the
national banks the means of accomplish
ing by legal methods the things which II
the crisis they felt compelled TO accom-
piish by illegal and destructive methods
10 the comtry's great loss.
Mr. Aldrich reviewed the objection o
some banks TO the bill on the ground tina
the issue Of emergency notes would b,
Improbable 10 the banks. and therefore
would not be taken out by them. The
bin was not designed 10 give profits {,
the banks ne declared, but, in fact, there
was an erroneous idea of its effect OF
bank profits and he believed that in time
of public panic the great majority O
the banks would do as they had done II
the past-give the strongest possible eVi
dence Of their patriotism and unselfsh
ness.
Conditions Have Improved,
Senator Aldrich said. I'm part:
Il am quite we'll aware that flnancia
conditions have vastly improved owe
what they were six weeks ago, and
think We may feel quite confident tina
the prolonged period Of depression whlcl
followed the panic Of 1898 may be avoided
It is also quite certain that in all TN
financial centers within a very short tim
there VIII be a great excess OF currency
and probably a surplus of loanable CAPT
tai,
Il believe it 10 be the imperative dut!
Of Congress, in their wisdom, to pro
vide some means of escape from anothe
calamitOus crisis. The expedients WhicI
the responsible officers Of the government
and the great financial institutions wer
obliged 20 adopt In the panic OF 1907 pOin
the way to effective curative legislation.
Two Plans Considered.
Two plans for general legislation whic
are prominent in public discussion wer
considered by the committee:
First, that advocated by many thought
ful students OF economic history ant
teachings. who are led by the experienc
and practice of other commercial nation
TO favor some plan for a central bank q
issue. which would be in effect a centra
clearing house with very limited bankin
functions, under government contro
Personally. L believe that i'm time thi
country is likely 10 adopt such system
but I agree with other members of tn
committee that its adoption at this time
or in the near future. is out Of the ques
lion.
Second that supported by a larg
number Of bankers and students. VIII
maintain that our monetary system wi
never be placed on the proper basis unit
the sole power o. issuing notes is lodge
IN the banks, the security OF such notes Z
be based upon a general pledge Of the as
sets of the banks, their conyertihility TO b
undertaken by the banks and TO depen
upon an insurance fund. This plan in
wolves an entire change I'm the characte
Of our currency and the ultimate retire
ment of outstanding United States note
and gold and silver certificates. The com
mittee were unanimous in the opinio
that this plan would not be likely to re
ceive the favorable consideration Of Con
gress at this session.
THE committee, after full considera
ton. felt that it was safer 10 follow. 3
the form Of legislation they should rec
ommend, the experience OF the great com
mercial nations. Who have found it nee
cssary To provide means To meet or pre-
vent panic conditions by the extension
of note issues under different restriC
tions and conditions from those impose
on ordinary issues.
simple and Effective Remedy.
The remedy We provide is simple
prompt, and efficient At any time with
III forty-eight hours, If an emergency re
quires it, $5000oo,000 Of new money ca
be put into the channels of trade 10 ALA
public excitement, ana to meet ezra