The Farmington times. (Farmington, St. Francois County, Mo.) 1905-1926, 1908-07-17
THE ALDRICH vREELAND hill.

Certain Republican leaders in Congress-
IKE AldrlCh and Nreeland, following a
coteric Of great bankers and Gnnncierg
affected to believe that the panic was due
10 n laCk OF money and the wnnt of
Mea!er HrNlbility IN our currency system.
lntltupon thcy started in to ucubate n
remedy, and the result Is the hyphenated
iHohslrosity known as the Aidrich- Nrec-
land law, Of this law wish now To
Sp,3N. Irlor to It's passage national
hlhk notes were issued only when limited
states bonds were deposited TO secure
thcm. The new law makes two radical
changes In this particular First. under
inns law national banks may now under
ctItllh conditions pledge state. county
town and municipal or district bonds a.
me basis of their circulation. Upon such
bonds the banks may receive circulating
motes tIu4l IN amount to ninety per cen
tun OF the market value OF the bonds
deposited, the market value to be as
ccTtained under the direction OF the Sec
IetAry OF the Treasury, not to exceed the
PIT value or the securities. Second,
uhurr tnlS law ten or more national
banks, having an aggregate capital and
surplus OF at least s., 600, 900, NAV or
gnnlhe what is termed national cur
th hmSS nSsoGlatlon: The chief purpose of
uAl bank, member OF the associate
10 US" It's commercial paper that ia
ptolnlSsory notes, as the basis of circu-
ihtlon. IL bank holding membership in
one or these associations should desire
TO use Its commercial paper to Obtain
nunl,lohal circulation. 1t would be re-
luiitu IN the first instance to lay the
proposition before the board of managers
OF the association. together with the
securities 1t offered to pledge II the
Officers OF the association should npprnVc
VIC hpphchtlon, 1t would then be their
duty to value the securities and trans.
nut the proposition to the Comptroller of
the Currency. II in turn that offIcer
should approve II, 1t would then be his
Iuty 10 lay 1t before the Secretary OF the
treasury, and II he should be OF opinlnn
mat IN" conditions contemplated by tho
law existed and that all statutory re-
lulremtnts had been complied with. he
M1u,u uItect inc issue of additional cir
culhtlng notes. based on the commercial
securities pledged, To an amount, I'm his
discretion, not to exceed sevcnty-tiye pcr
Ge.ntum OF the cash value OF the sec,iri-
Ties deposited. These circulating notes
would be delivered in the first Instance
70 the currency association for and ON
bohalt OF the particular bank applying
inr them. The entire association. under
u uIn n,w, would be responsible for the re-
compton or the notes. the association
holding the pledged securities to indernni-
~ 1t. The evident and confessed object
OF the law is to enable the larger national
banks TO unite their credit and CONNER
clnl assets, and by cooperation TO utilize
them to obtain additional circulation rs
tney might have occasion to need IL The
Jaw liNes the aggregate amount that may
Nh
w VW. All notes issued under the pro-
visions OF this act are made subject 10 a
tax at the rate OF 5 per cent per nnnum
Tor me hrst month, and one per cent per
Honth additional thereafter until n rate
OF 10 per cent per annum is reached The
notes Issued under this law are known ms
emergency currency" and the tax re-
ierred to is Imposed to hasten their early
retirement.
This, In substance Is the remedy oer-
tam national bankers and Republican
statesmen. acting In corporation, pro-
pose as panic preventive and par.acea.
vision limiting Its continuance to six
years. That is the duration liked by its
terms. l venture to say, however that
while II Is claimed to be an experiment.
really put out as foeicr. il the ' people Cpl"
endorse the measure. IL they fail 10 ex-
press their disapproval OF II, then the
policy II inaugurates will be continued.
II Is the first hesitating step toward
turning our monetary system over 10
the national banks. Movements OF this
Kind gather volume as they go. Is II
possible that the American people are
willing to endorse this dangerous depar-
ture? Here. more than ever before, the
government abdlcates the sovereign func-
ton imposed upon 1t by the constitution
OF making money. and confers that
upon corporations The high duty OF
providing a safe and adequate currency
to the people is one OF the most delicate
and important functions Of our sover-
eighty. 1t Is n function the ADerican
people cannot AFFORD to delegate to pri-
vate, or semi-private, public bodies.
That Is prerogative that should re-
main exclusive and unimpaired in the
hands OF the people. or In the hands OF
their public representatives. 1t Is no
answer to say that in n great emer-
gency, like that recently experienced. the
banks under a law of this character
xtyn hA att t.frfI, Hal 10. ball
ability to relieve monetary and
commercial stress. II that were all OF
II, and II there were no other and higher
consideration involved. and II the banks
should In the utmost good faith use the
law alone for legitimate purposes, II
might be that no Immediate harm would
result. But the principle IL wrong. tho
policy vicious. and both trench upon the
constitutional privilege and duty of the
sovereign government. Moreover, this
law, as II Is, may be employed to work
unspeakable injury. II enables banks
and banking associations to value their
a. s.t,f utp rlr Int ts1ar