Omaha daily bee., 1908-02-07
Contention that New York Banks
Were Unduly Favored.
ALAsKA-YUKoN BILL PASSED
Measure Provides for Government
Exhibit at Proposed ExpOsi-
tiOn-Mr. Burkett Speaks
Against IL.

tarY OF the treasury on the Panama canal
bond issue, in order TO substantiate his
contention that national banks of New
York City were unduly favored by the
disposition OF public funds and had yio-
lated the law by issuing those bonds
The last hour OF the day was devoted to
a further consideration Of the bill to revise
the criminal laws Of the United States.
and at 4:2S p. m. the senate adjourned until
next Monday
Burkett Opposes Exposition.
The senate today passed bill providing
for the participation of the United states
in the Alaska-Yukon exhibition at Seattle
in 1909.
In the discussion before the bill was
passed Mr.. Burkett of Nebraska opposed
the bill, as he said he had opposed every
| other bill for such purposes since he had
been in the senate. During the debate Mr..
Burkett said the proposition to hold the
exposition did not originate in Alaska ut
has been put forward, he said, ''by lot
of boomers of Seattle who propose to boom
their real estate and their private inter-
| ests."
"The men who promote these expos-
! tions," said Mr.. Burkett, ARE not the men
who have to bear the responsibility for the
| bills incurred. They start an exposition
! ana uniOau InelT IDEAS on lne community
and then demand our money and the money
of every nation on earth to pay for it
| Mr. Burkett read list of expositions in
the United States showing that $50 $50. 727
had been expended by congress in aid of
| them.
Mr. Tilman supported the idea OF hold
! ing expositions, saying the Charleston ex-
/ position had brought a great many people
! from the north to the south to he "civi-
lied there. He believed in expositioHs in
| order to encourage travel among the people
from one section to another.
The passage of the bill followed.
Speech of MIR. CuIberson.
| In a speech in the serate today Senator
| Culberson declared that the secretary of
| the treasury by his report to the senate
has raised an issue of fact as to whether
national banks in New York used the
SIS. .OOO. 900 of public money deposited with
them for speculative purposes whether
this money was used to meet the demand
of outside banks for reserve purposes.
Mr.. Culberson complained that the COM
fnittee on finance had failed to take any
action on his resolution directing that It
inquire into the eanses of the recent finap-
cial stringency. He declared that the re-
port of the secretary of the treasury had
/
law in issuing the Panama bonds, be-
cause money for the canal was not needed
and that he had violated the law in
awarding these bonds to national banas
| instead of individuals and in using the pro-
| ceeds of the sales for the purposes set
forth in the report and not for, the con-
struction of the canal
In issuing the 3 per cent certificates
the secretary also violated the law, Mr.
| Culberson said, because they were not
used for the purpose as provided by the
statute, as there ample funds for
such purposes. Moreover, he said, the
! secretary had violated the law in issuing
the 3 per cents, as the law limits the
basis of such notes to registered bonds
of the United States and TO Panama bonds
He had also failed to distribute this
money as provided under the act of March
4, 1907. His distribution was inequitable
said Mr.. Culberson. as the money was used
by the New York banks for speculative
purposes. THE public money deposited
in the national banks of the United
States" said Mr.. Culberson, ION March
%, 1907, was $14O,00O,0OO. On December
the amount reached the enormous sum
of S223, 200, 900. In New York City alone
on March 22 the amount was 1000, 900
on deposit; on August %, $2s0OO. 900, and
on December 8, $75,OOO,OOO
New York City with about one-sixth
of the capital and surplus OF all the banks,
secured one-third OF all the public money
on deposit the eastern states, including
New York. having only about three times
the capital and surplus of the southern
states, were given four times as much Of
the public money
Mr.. Culberson charged that the report
. ] Of ba nF he
denial Of some of its own statements.
One Alleged Contradiction.
THE secretary of the treasury" he said
says in effect that $25,OOOOOO of specie
held by the New York banks and $4,000. 600
of reserve was used TO meet the call of
outside banks whose reserves the banks
of New York hold, whereas the report
of the secretary shows clearly that the
amount which the national city banks
owed other national banks decreased be-
! tween August p and December s, only
SO S2O,511, and II is significant that al
though the New York City banks did not
pay 20 the banks outside OF that city more
than this S10S9O.A1 they increased their
loans and discounts during the same time
$S2 10000"
Mr.. Culberson declared that while New
York had so much cash in its banks south
ern banks were paying a premium for cash,
and added the declaration that the panic
did not arise from natural causes, as the
crops and general business OF the country
were never greater than last year.
Reply of Mr.. Hopkins.
Senator Hopkins replied briefly to Mr.
Culberson. saying: Every statement made
by the senator has been answered by the
secretary Of the treasury, and il any one
will take the trouble TO read that report
he will find there a complete answer 10
all that has here been charged. Instead
/ OF the secretary showing favoritiEn to
New York or other banks he has been
actuated by other patriotic principles and
he made the deposits IN New York. Chicago
or other banks because they Were located
! where the emergency existed"
/ Mr.. Hopkins read extensively from the
! report OF the secretary OF the treasury
explaining his reasons for what he had
done. saying he wished these reasons TO
| 20 out with the speech Of the Texas sena-
/ tor.
Mr. CulbeEsOn said the secretary refused
/ TO give the Texas hanks deposits they