The Irish standard., 1908-10-17
BANKING system
IS CONSIDERED
The Public is Entitled to a
Greater Measure of
Security.
Guaranty of Bank Deposits
Looked Upon With
Favor.


titled to greater measure of secur
ity for their savings than is afforded
by national and state banks as at
present constituted. writes John B. Nc
Mahon in the Notre Dame Scholastic.
AS evidence of this feeling Of dis
trust there is an estimated billion dol
lars belonging to Americans which is
new on deposit in foreign state banks.
Every bank failure accentuates this
feeling of insecurity: men hasten to
withdraw their deposits: bankers are
forced to call in their loans to meet
these Withdrawals. and so periodically
we have q paralysis of business such
as we are now experiencing There
is crying need for some means Of
restoring confidence: for some method
thing that will prevent the f1uctuation
of prices which attends the change
from the scarcity of money to it's
abundance. There is a demand for
change; and If by some method the
money which is now seeking invest
ment in national and municipal bonds
at high premiums and low interest, can
be directed into the channels of in
dustry. it means ultimately increased
higher wages for the employed, and a
better and more prosperous condition
which would inevitably be communi-
Gated through the different branches of
American life.
The existence Of such a demand has
no better proof than the fact that both
of the great political parties have rec
ognized It and inserted in their respec-
tive platforms plans which. while
widely differing in the means. have a
common object in the security they
promise TO the savings Of the Ameri-
can people and the confidence they
propose to restore. One of the great
issues, therefore, before the American
electorate. is whether they prefer the
Postal Savings Bank. which is the
remedy offered by the Republican par
ty. or the governmental guarantee of
deposits which Is offered by the Demo-
claims on the support of the American
business world.
The Postal Savings Bank is an am
plification of the postal money order
system. Under it's operations. we pre-
sumo. a small amount Of interest would
be paid and the money safely invested;
thus making the United States govern
ment the creditor of the saver and
the custodian OF these funds which
might think expedient. subject, how
ever, to the demand Of the depositors.
Thus the savings of the people arc
absolutely safe. and confidence in the
business world restored. The Postal
Savings Bank as proposed by the Chi
cago platform and as explained above
is open to many serious objections.
There are other things to be consid-
cred besides security of the dcpositor;
and the money that is deposited in
every bank is needed in the business
world.
What then would the government do
with the money it receives as deposits?
II 1t holds 1t without seeking invest
ments. or seeks only such secure in
vestments as municipal. state and ma
tional bonds. it does great damage to
the business world by withdrawing
from local industries the money which.
under our present system, should be
loaned to them for the upbuilding Of
shops, starting Of mills and the conduct
Of many other branches of commercial
activity. II the government officials
deposit In other banks. as it Is pre-
sumable they would, it amounts to the
practical maintenance Of two banking
systems. one of which Is obviously SUI
perfiuous. And If the government at
tempts to conduct a regular banking
system and to have local bank off,
cials, etc.. it amounts to government
ownership and management Of the
banking business. and is opposed to the
belief which. 1t is generally conceded,
obtains among the American people
that the government should not under
take the operation of business that
might with the same ease be operated
with profit by individuals. In a word,
the Republican plan, while offering Sc
curity to the depositor is a menace to
the farmer and business man of any
community. since whatever is done
with the deposits. it is attended with
Inconvenience, useless expense and the
withdrawal of money from the local
industries which need it and upon
which local prosperity depends.
The remedy proposed by the Demo-
cratic party in its platform as adopted
"a r>~sv~v+ i~t 10. 49,, 1~iux~~ e.