The Montgomery advertiser., 1908-08-28
Speech at Topeka; discusses Bank Deposits
IaIDAY MORNING.

DQHR DePOSlIS son which they then learned. The i pemocratic party, being more Tree spond to, the needs of the masses of | the people. inserted the following nlsnk n h its national platform;
 which the national banks shall be re- l quired to establish guaranty fund for the prompt payment of the deposltors or any insolvent national bank. under | an equitable system which shall be ayailable to all State banking institn- | tions wishing to use it'sS'
 This principle has been applied in very satisfactory. The average annual loss to depositors In national banks during the last forty years has been less than one-tenth of one per cent of ] in Oklahoma under better regulations and restrictions has been absolutely nothins. during the six months in which the law has been in oberation.
 Tho Republican platform is silent on the subject. and the Repubiiean can- ! didate not only does not avocate a com pulsory system. hut specifically and enphatfcally opposes it. He says:
 The Democratic platform recom- mends tax upon national banks and upon such State bapks as may come in. in the nature of enforced insurance to
 
 positors of any bank which fails And then he questions the right of the government to enact such law. saying:
 How State banks can be included in such a scheme under the constitu- ton is left In the twilight zone Of 1 State rights and Federalism so frs- quently dimming the meaning and pur- pose of the promises of the platform. If they come in under such a system. they must necessarily be brought with n n the closest national control. and So they must really cease to be State banks and become national banks"
 His selicitude for the State bank will hardly impress the country, for he Is served rights when he deals with other subjects. When Congress is in the con trol of those who want to legislate for the whole. people rather than for the few, 1t will not be difficult to frame 8 law under which State banks can avail themselves of the. advantages of a Fed- efal law guaranteeing the deposits Of national banks, just as 1t was easy in Oklahoma to frame a law which per- | mitted national banks to take advant- age of the State guaranty system. It will also be easy to enact Federal to avail themselves of State guaranty | systems until national system can be l secured. Attorney General Bonaparte's 3 ruling, whether 1t correctly interprets | the law or not, would not bring such | consternation, as 1t does if the Repub- l lican candidate favored a law allowing l national banks to aaiSe advantage of positors. but Mr. Taft,s hostilaty to all 1 guaranty systems Is shown in the ob- l jection which he offers;
 '.The proposition is to tax the honest | and prudent banker to make up for the dishonesty and imprudenee of 1 others. Notoue can foresee the burden l which under this system would be in- l posed upon the sound and conservative | ha 1rar of a 1- tien to make good the losses caused by 1 the reckless. speculative and dishonest men who would be enabled to secure | faith of the proposed insurance; as in i it's present shape the proposal would l rt move all safeguards against reckless ness in banking and the chief, and in I would accrue to the specnlator, who would be delighted to enter the bank | ing business when 1t was certain that accrue, while the risk would have to be assumed by his honest anu hard-work- ing fellow. ..ssg.. ss-. He even pictures dtre disaster and and | adopted exactly as the Democratic
 platform suggests. 1t would bring the
 whole banking system of the country
 AS an afterthought he suggests that
 a voluntary system might be toiera ted
 put as his lectlony to r.ss prlsSS,rss z Y | tary system we niaw fairly count, him against all legislation which has, fol
 its object the guaranty of. 4epositors
 sented m AI; by the Sig d bank banks whieh put l their own selfish Interests above the 1 welfare of the. depositors -and the safety of the community, It is worth | sitions which he advances.
 Let us take the first sentence that "the honest and prudent banker would 1 ty and imprudence of others.' Is not this true of all restrictions on bank ing? Does not the honest and pru- | in order that the depositor- may be 1 protected from the dishonest and inn l prudent? If we had no banking law
 vate .indbyidua4s. sthe honest, and pru- dent banker would save the, money
 that he now pays for enforced exami-
 times make interest on a part of the l money which he Is now required to
 keep in his vault as q rigid reserve
 prudent. these laws place a burden | upon the good as well as upon the bad. 1t being difficult to distinguish dent one until a bank actually fails.
 In like manner 1t might be said that l If all people were careful about fire high as, they are. but the careful have l to pay higher rates than they should 1 because some are not careful. Life l insurance rates are higher than would l be necessary to cover the actual risk 1 if everybody took care of his health
 and here. too, the cautious are bur
 dened because some are careless of
 their health. All insurance is open
 to the same objection. and yet insur- l ance of all forms Is growing. and the
 insurance of depositors Is growing in
 popularity more rapidly than any oth- l CT form of insurance-and I may add 1 1t yields the largest return on the in- | vestment. e4t
 Mir. Taft complains that mo one l can foresee the burden which under the sound and conservative bankers of the country by this obligation to make good the losses caused by the reck etc. We have the past to guide us. | and we have reason to believe that the loss will be less in the future than in