Grant County herald. [volume] (Lancaster, Wis.) 1850-1968, 1908-09-16
GUARANTEEING BANK DEPOSITS.

GUARANTEEING BANK DEPOSITS.
One of the planks of the democratic
national platform on which Mr.. Bryan
is appealing to thu people for votes
in his behalf is the one which would
call for a compulsory guarantee of
bank deposits by the government. and
he entertains the hope. because of the
financial furry through which the
country passed last winter that this
will prove striking appeal. We
do not believe it will be so.
The rank injustice that would result
from such law was pointed out by
Congressman Hill in an address de-
livered just before the close of the
Vermont campaign, q few days ago,
in which he showed the fallacy of the
bank guarantee theory In Connecti.
cut there are so national banks. 2 state
banks, % trust companies, and 81 saw
ings banks, with total deposits of
$342, 83S, OBJ. Practically all banks
would be drawn under the federal
law by the proposed Bryan guarantee
scheme, because those outside of it
could not meet the competition of
those inside advertising a federal
guarantee to all depositors
If an assessment of q of one per
cent was levied upon the Connecticut
banks the state would have to pay in
to the federal fund 1923, SAT a year,
$500, 465 of which would come from
the savings banks that have no stock
holders, and would, therefore, be de-
Quoted directly. from the savings de-
posits. what would Connecticut
get in return for this contribution 2"
asks Mr.. Hill; and he thus effectively
answers his own question
Connecticut would have the entire
amount Of losses to depositors in her
failed banks last year made good to
them. How much was that Moth
ing. How lnuch the year before :
Nothing. How much for the last
ten years2 Nothing for National
banks. nothing for state banks, moth
ing for trust companies, and only
$3l. 3S7. 20 for savings banks; so that,
if this benefcent Bryan plan had
been In effect for the last ten years,
assuming the same average of deposits
as last year, Connecticut banks would
have paid out 81. 2S5, 547, and their
depositors would have got back $31,
3S7. 40. She would however, have
had the privilege of helping make
good the losses to the depositors of the
speculative banks and stock gambling
trust companies of Wall street and
numerous other similar institutions
in other parts of the country. -
The foregoing is one of the most
effective exposures of the plausible
but falIacious, unjust and dangerous
scheme that Mr.. Bryan is now special
ly exploiting As Mr.. Hill puts it,
a uniform guarantee of deposits at an
equal assessment is in effect guaran-
tee by the United States of the hon
esty, integrity, general business abili-
ty and special good judgment of
20. 900 boards of directors and all of
the officials of the banks which they
represent. Long experience, demon
stIated ability and integrity, thorough
knowledge of the community and its
industries, the amount of capital in
the business, all these and many other
things which would grade the risk if
it were purchased from any indemnity
company on earth all count for moth
ing in this wildly paternalistic Bryan
scheme which is condemned emphatic
ally by every recognized banking and
financial! authority on earth.
Banking conditions are different in
the various sections of the country.
Discount rates are different; so are
the risks and rates of interest Why,
then, should the government attempt
forced equalization of credits, and tax
Connecticut, or Wisconsin, or New
York to help bu mess and secure
depositors in Arkansas. Oklahoma or
other states where higher interest is