New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1908-10-21

nsnts and county governments and
municipal governments make similar
requirements But now that It is pro-
posed that depositors generally shall
have some such assurance for the
safe keeping of their wealth, we are
told by the Republican candidate for
the Presidency that the adoption of
such plan would bring the whole
banking system Of the country down
to ruin
okiahoma's Object Lesson.
Oklahoma has the guaranteed de-
posit plan and the following Associat-
ed Press dispatch tells of its opera
ton in the first bank failure since the
law went into effect:
Guthrie, Okla, May 81, 1908
Within one hour from the time H. H.
Emock, Oklahoma banking commits
sioner, had taken charge of the In
ternational Bank of Colgate he had
authority to pay the depositors in full,
though the banks cash and available
funds In other banks fell $4,000 short
Of the total amount of deposits. The
commissioner was enabled to do this
under the operation of the new bank
Ing law, and this is the first time 1t
has been called into use. Under the
operation of the guaranty banking
law of Oklahoma tariff of / cent is
levied upon the average annual de-
posits of the banks, and this money
Is used in payment in full Of all de-
positors of an insolvent state bank
after the funds have been exhausted"
VIII the Banks Answer This?
In addition to the arguments al
ready presented in favor Of the guar
anteed bank, the following is sub
mitted:
The United States Government re-
quires deposit of specific security
when it deposits money in national
bank; the state also requires secur.
fly, and the county and city deposits
are secured either by bonds or by tho
deposit of specific securities.
Now the question arises, If the
United States Government, which car
at any time inspect bank and fino
out just what it is doing and how its
business is being conducted, requires
security for its deposits, why should
not security be given to the depos-
itor who cannot examine for himself
and does not know anything about
the banks solvency or methods? And
| loss to the national government, to
the state, to the county or to the city
would be borne by all the people and
thus be small upon each one, while
the loss to the individual has to be
borne entirely by himself and may
wipe out his entire savings Is not
the argument stronger in favor of the
| protection of depositors than 1t is in
favor of the protection of the nation
the state, the county or the city?
But the case is even stronger when
the bank is required to put up specific
security for the protection OF national
state, country, or city deposits. Its
gilt-edged securities are thus hypothe
Gated and the inferior securities are
left for the security OF the depositora
SO that, as matter of fact, the pub.
lie deposits are not only protected
but they are protected at the expense
of the individual depositors. What
shall we say of a national bank which
willingly gives the government speci
fic security and then opposes the pro
| lection of depositors? And, strange tt
say, these big banks that get the long
deposits from the government upor
specific security are the very ones tina
have fought and are fighting the sys
tenn for the guaranty of depositors
J 1t is time that the depositors under
stood the situation and got together
for their own protection. Will an!
banker who is opposing the guarant.
system answer this argument and ex
plain why it is right to protect gov
eminent deposits and wrong to pro
tect individual deposits?
When the International Bank a
Colgate, in Oklahoma, failed, the fol
lowing notice was posted on the door
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