Barton County democrat. [volume] (Great Bend, Kan.) 1885-1915, 1908-08-28
Bank Guarantee.
GnODO11 By William
OPNNNAA Jennings Bryan
Topeka, Kansas, August 27, 1908.

lecting the assets of thee failed bank
Five hundred and fifty-five banks in.
cluding fiftyfour national banks, had
come under the provisions of this
law on the 14th Of last May, leaving
but 255 unsecured banks (all nation
al in the state. Statements are
made by the banks in December and
May. Between these periods the Sc
cured banks gained in deposits s4,-
2S7, 1892, while the unsecured banks,
all national, showed a decrease in de-
posits of $1,1O1,SN.S6. A large part
Of this increase represented money
brought from hiding or from without
the state, but the decrease in the un-
secured banks can only be explained
in one way. A large number Of de-
positors withdrew their money FRONT
the unsecured banks, and deposited
1t in the secured banks, and this, too,
in spite of the fact that in order to
prevent withdrawals, the unsecured
banks, in some instances, offered a
higher rate of interest than the &C.
cured banks were permitted to pay;
and It must be remembered also
that the banks which suffered loss
of deposits were all national banks.
And to make 1t certain that the dif-
ference was caused by the guaranty
law, the secured national banks gain
ed, while the unsecured banks lost.
/ While the deposits were increasing in
the guaranteed banks of Oklahoma
they were failing in the state banks
and trust companies of Kansas-the
decrease being sl.15SO26.27. between
March 31st and June 18th.
No amount of criticism Of the tim
id depositor can change the facts;
more security than the laws at pres
the people who deposit money want
ent give them. They will change
banks to get more security and, il
necessary, they will send their mon
ey to another state.
For many years efforts have been
made in Congress and in the various
states to secure a law guaranteeing
deposits, but the influence of the
great banking institutions has been
sufficient to prevent action. Last fal
however, when the banks by con
certed action suspended payments on
checks, the depositors were every
where brought to a realization OF
the fact that their deposits are in
fact loans, payable on demand under
ordinary circumstances, but payable
at the will of the. bank in emergen
cies. The depositors suffered a con
siderable loss during the suspension
of payments, and they have not for
gotten the lesson which they then
learned. The democratic party, being
more free than the republican party
to respond to the needs Of the mass
es of the people, inserted the follow
ing plank in its national platform:
'We pledge ourselves to Legislation
by which the national banks shall be
required to establish guaranty FUND
for the prompt payment of the de
positors of any insolvent nationa
bank, under an equitable system thai
shall be available to all state bank
ing institutions wishing to use it."
] This principle has been applied il
Oklahoma and the results have beer
J, very satisfactory. The average an
nual loss to depositors in nationa
banks during the last forty years
has been less than one-tenth of on,
per cent Of the deposits, and the los'
to the fund In Oklahoma under bette
regulations and restrictions has beel
absolutely nothing during the 81,
, months in which the law has beel
in operation.
The republican platfrom is silen
] on the subject. and the republical
candidate not only does not advocat
q compulsory system, but specifical
" and emphatically opposes it. H
says:
, The democratic platform rex
iommends q tax upon national bank
: and upon such state banks as ma
: come in. in the nature of enforce
} insurance to raise q guaranty fun
to pay the depositors Of any BAN
s which falls
And then he questions the right Q
. the government to enact such a Law
, saying;
How state banks can be Included
such a scheme under the constitutio
: is left In the twilight zone Of stat
rights and federalism SO frequentl
dimming the meaning and purpose
J 1.-THE promises Of the platform.