New Ulm review. (New Ulm, Brown County, Minn.) 1892-1961, 1908-03-04
BRYAN ANSWERS BANKER FORGAN
Tells the Chicago Financier a Thing
or Two About the Guarantee.
ing Of Deposits.

W.
In the last issue. of the Commoner
William J.. Bryan replies to the letter
sent him by James B. Forgan, presi-
dent of the First National Bank Of
Chicago, bearing on the question Of
the safety Of banks. 81. ....s,~
Mr.. Bryan says, as he understands
it, Mr.. Forgan objects to 3 govern
ment guarantee of deposits because it
would putsall banks On an equality.
This he declares is selfish and unfair.
+ "Let me make the charge SO directly
that there can be no question about
what mean" Mr.. Bryan says. IT
charge that you put the interests OF
your stockholders above the interests
ofathe various communities and of the
public at large. You admit this when
you insist that the guarantee of all
banks would deprive your stockholders
of value which has come from wise
management.
''The people who deposit money in
your bank do not, as a rule, know
anything about the management of the
bank. They do not knew anything
about your methods of doing business.
"They do not know whether the d.
rectors are using the deposits for their
own enterprises or carefully guarding
them. They do not know any more
about the interior workings of your
bank than they did about MIR. Walsh's
bank or than they knew about other
banks that have failed. They take it
for granted that your bank is safe be-
cause they trust the government and
have confidence in the regulation, re-
striction and inspection of banks. If
you had rented room and announced
that James B. Forgan woald accept
money on deposit and carry on bust
ness as private banker without any
regulation or restriction as to the man
ner of conducting the business you
might have claimed credit for such
reputation and standing as you might
have been able to acquire. But you
did not do that. You associated your
self with bank whose prestige and
reputation depend more upon the law
and on the presumption given by the
people to the law than on your super
ior care or management.
"When the laws were made the law
makers Thought they had provided for
the security of depositors, and it is
not only unfair in you to count as en-
tirely personal to yourself or your d.
rectors the confidence shown by the
public n your bank, but it is selfish to
insist that the people have nc right to
obtain further security, even if, as a
result of that, your bank loses some
of the advantages which it now has
over smaller banks. The bank exists
for the benefit of the people. 1t is a
mistake to assume that the people ex
ist for the benefit Of; the bank. The
laws regulating banking are made for
the deposltors rather than for the
stockholders, because the stockholders
are able to protect themselves, while
the depositors are helpless.
"What security do you give your de-
positors that other banks do not give
their depositors? Is it that the officers
of your bank are better men? They
may die, and inferior men take their
places. Is it because your directors,
are better than other directors? The
board of directors may change. Is it
because your stockholders are better
than others? Your stock is sold on the
market and change may take place
any day in the ownership of the stock
that will entirely change the character
of the bank, and if such change takes
place. who will know it?
sThe fact is that the country is suf-
fering today from lack Of confidence in
banks more than from any other
cause. The money cannot be drawn
from hiding and boarding unless the
depositors are assured of the safety OF
the banks. The amount of the tax on
each bank would be little compared
with the benefit which it would receive
from its share of the increased depos-
| its and as for m akinp hanks unsafe