Lower coast gazette., 1910-03-19
SATURDAY, MARCH 10, 1910.
The Postal Savings Bank.

who are pressing this centralizing measure by
means of which it may be made easy to get
more and more money under the control of the
central government and of the friends OF that
government when the emergency demands it,
now find themselves in hot water, so to speak.
Senator Elihu Root admits that as a straight
proposition the u. S. government has no right
to run a postal savings bank. In order to cir
cumvent the fathers OF the country who so Skill
fully laid its constitutional foundations, Senator
Root now suggests that the postal savings de-
pository bill can be made constitutional by being
made an adjunct of the governments borrow
ing power. Whether the governments borrow
ing power can be increased in that way is still
another question which Mr.. Root believes can be
solved, whether by q constitutional amendment
or not, we are not yet advised.
Thousands of millions OF dollars nc deposited
by the poor people of the Eastern States in the
savings banks in Boston. New York, Philadel-
phia ard Baltimore. These savings banks are
under careful legislative control and inspection
and are not allowed to loan their money as a
rule on anything but first mortgages on real
estate and then to an extent not to exceed fifty
per cent. of the property's market value. For
more than a century now it has been possible in
this way to preserve the savings of the poor in
these great banks, the management Of which
lies in the hands of trustees who do their work
without compensation and regard it as a special
distinguished honor to be selected for the
Offices.
The postal savings bank is an effort to get
into the hands of the Washington government
these thousands of millions Of dollars and it is
pretty manifest that the government wants to
have a comparatively free hand in the DISPOSE
ton of the funds. In some Of the minor regula-
tons as the bill has now passed the Senate. it
is agreed net to accept deposits in excess of $500
and to deposit the money thus accumulated in
the local banks, except in some emergency when
in the judgment of the president war or any
other eXigency involving the credit of the gov
eminent requires the control of these funds, in
which case the trustees may withdraw all or
part and invest it in bonds or other securities of
the United States. 1t has been a compare
lively open scandal that during the last fifty
years the funds of the United States have been
to a very considerable extent under the control
of the Wall Street magnates. When they were
sorely pressed for funds the secretary of the
treasury, as a rule, wouId open the Golfers of
the government and let the banks have refresh
ing supply of much needed money. The present
postal savings bill is intended to make this re-
lief automatic and if for a decade or two, things
should go along peacefully and successfully,
some thousands Of millions &C dollars would be
available in just this way. The Wall Street 4
magnates who may have access to the presiden-
tial ear could quickly convince his excellency of
the emergency necessities OF the case and the
purchase of a hundred, or hundred millions
OF dollars of 2.25 per cent. bonds By the postal
savings bank would be the result.
Untold millions of dollars have been put in
the savings banks Of the Atlantic States by the
Irish and other servant girls. We have known
like these to have five, six or seven hundred
dollars in these savings banks, wherein they
got three per cent. per annum interest and there
stored the accumulations of years. To now
throw these funds, all or any considerable part of
them, into The political pot and under the control
OF the political and trust manipulators is certain
a very dangerous experiment. If it be uncon-
stltutional, as Mr.. Elihu Root seems to think. it I
ought to be thrown out in the lower house, al
though it has now passed the Senate. We can
hardly expect President Taft to veto the bill I'm
it reaches him in a very m~utilated form, as
1t seems to be one of his pet measures. The
bill passed the Senate on a vote of so to 20 and
on a straight party vote, excepting that one
senator voted for it. Senator Cum
nlns OF Iowa endeavored to insert in the bill a
to this proposed diversion of the
to the time of actual war. His amend
ment was rejected, while the amendment of
Borah that the funds should not be in
Vested in bonds bearing less than 2.5 per cent.
interest was adopted. AS postal savings banks
seem to be popular in England, and we believe
n some OF the continental states, many of our
citizens are rather Indifferent to the
ate of this bill, overlooking the fact that it
transfers. one more power from the states to the
central government, that is the control of the
'aWngs and the power of the country.