Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1908-02-28

4 ~.
wild western state-the first thing
they did was to pass law to guaran-
tee bank deposits. How did they do
lit? They authorized a banking board
to collect an assessment on the lfth
of this month of l per cent on the de-
posts of the banks. | think it is
higher than necessary; one-half OF l
per cent would have been enough,
even one-fourth of 1 per cent would
have been sufficient, but they said
per cent and they empowered the
board to asses at any time and to any
lextent necessary TO keep that reserve
intact. And thus they put behind
levery bank the assets of all the banks.
In anticipation of the operation of that
law. the bankers of Kansas petitioned
their governor to call a special SEES
sion of the legislature to pass a law
like it so as to keep the money from
being drawn out of Kansas banks and
deposited in Oklahoma. Great laugh
teri
Law VIII BE Enacted.
And the legislature is now in ses-
sion. 1t win enact such law. 1t has
been introduced in Illinois. 1t has
been introduced in Ohio, and l had
the honor to receive an invitation
from the republican Legislature of
Ohio to come and address that legis-
lature on a guaranteed bank. Posi-
IDLY, | was invited because some IA
years ago | tried to secure the enact
fment of such a law by congress. We
had failure in our town and many
| poor people suffered the loss of their
savings, and the hardships visited
upon our community caused such a
cry of distress, that someone came to
mel wish could remember his
name-and suggested guarantee
fund. and | introduced in congress a
bill that provided for the collection
Iof small tax each year until a guar
antee fund was provided. The bill
provided that when bank failed the
controller should from this fund pay
every depositor Immediately. so that
there would be no loss to the deposi.
tor, and then proceed to collect the
assets of the bank and reimburse the
fund as far as the assets would 60
Now that was some Is or II years
ago What was the objection raised
That if all the banks were good. the
big bank swould not have any adyan
tage over the little ones-that the de
positors should all be unsecured that
the big banks might have an advan
tage over the little banks Where is
the patriotism that we have been hear
no oil in E,,a, II.
insist upon a system that require:
that the depositor shall have his in
terests jeopardized, and that the com
munity shall suffer that the big banks
may have an advantage over the little
banks?
| went out to Nebraska and go
that bill introduced there. | thought
surely, if We can not have it in tn,
o United States, We can have it in Ne
:, braska Uaughter.) But when tn,
" bill came up there was a lobby of ma
IS tional bankers to oppose it. "Why,
Is they said, IF state banks are safe
IL people will not deposit in -nationa
10 banks Oaughter) What is the oh
5 lection now? Mr.. Forgan, the heaC
lg of one of the largest banks in Chicago
e. stated as his objection that it woul,
'it make all banks secure. daughter
it What an objection! He said tha
re under such a system, you could jus
&c step in any bank and deposit you
We money! That would be awful, Cal
Mt plause) l ask you this question. m
at friends. must we leave the deposito
n helpless? Must we leave the comm
d; nifty helpless rather than have a
ne banks secure? What is more impo
tant than the security of the depos
OF tor? Why not look at this questio
ne once from the standpoint of eight
We millions of people who have lost hun
III dreds of millions of dollars in this pa
is ticular crisis that they never can &c
ne back? Is that not sufficient reason fo
III a different plan, or shall we sit bac
" and say, NO, it would not do to max
hS all banks secure, for then the hi
ny banks would not have any advantag
III over the little banks" The big ban
ms will still have an advantage over tn
III little bank. 1t does not need to re.
a., upon the insecurity of all. The ia,
''0 that it has large capital and surplu
49, enables it to loan more to one ind
~ vidual than the small banks can.
~ bank can only loan one-tenth of i
= capital and surplus to one person, an
~ a bank that has ten times the capt.
IN and surplus of another can accom-
he date the man who wants to borro
large sums. Isn't that an advantage
ob And then there is another advantag
sri. 1t has an advantage resting upon va
am ity. People like TO do business wi
I'M. the big banks; they like to go in al
est have the president of the biggest ban
his bow to them and smile daughter
i've Isn't that some advantage? Wouldi
zen that remain, even when all banks we
lev safe?
md Argue Danger of RectSIessness.
a What is the other objection? TIL
ork say that, if all the banks are secu
cen and the deposition can not lose, t
re- banks will be recklesSly managed.