The Bridgeport evening farmer., 1910-01-24
THE FARMER: JANUARY 24, 1910


 enacted, would ultimately lead to lack of confidence in our National Credit.
 To fully appreciate the force of these resolutions it must be borne in mind that in the highest Administration quarters in Washington the chief req son advanced in favor of the creation of such banks is that the Government could use their deposits to buy its own depreciated per cent. bonds for the purpose of raising them to par, and keeping their market price up to that point. But such an eXpedient, and makeshift, would be entirely unneces- sary, besides being very objectionable and unworthy of the dignity and greatness of the United States.
 Moreover, such an expansion of the Government credit would operate to undermine confidence in our National hnances,' as the deposits of Postal Savings Banks would really be trust funds which would, in time, aggregate thousands of millions of dollars.
 The decline in the market price of United States 2 per cent. bonds, own ed by National banks, and held,-with their other U. s. Bonds,-by the Gov ernment to secure their circulation and Government deposits, should not cause the Government to seek rem edy, or even a prop, for this in the use of Postal Savings Bank deposits.
 
 bonds would be unsound as politico economic measure, besides being pro- VOcatiVe of diStruSt. Let the Govern ment leave the bonds free to rise or fall, according to the ebb and flow of IT." market. The British Government does not try to prevent British Con- sos from declining. low as they are.
 A minor but still an important ob jection to Postal Savings Banks in this country would be the immense amount of clerical labor and bookkeeping they would call for, in proportion to the amount of the deposits, and their con- sequent costlness to the Government. The experience of the British Govern ment with them in England has been very unsatisfactory in this respect, and the official head of the system in London very recently stated that about a hundred thousand of the de- positors there never use these banks as savings banks, but merely as they would a purse, depositing a shilling or so one day and drawing it out one, two or three days later.
 He cited an instance when a person deposited a shilling-25 cents-and soon afterwards drew it out again in six separate sums of two pence each-four cents. This was certainly playing at banking at the country's expense. He said that each transaction of that kind cost the Savings Bank Department five and three-quarter pence, or more than eleven cents, this representing the cost of administration, postage and the commission which the Savings Bank Department has to pay the Post Office for the services of it's staff.
 Moreover, he added, this way of us ing the banks, and forcing unprofit able business upon them, has steadily increased, and is becoming so gener- al as to be very serious evil, and formal notices have just been issued to depositors thus abusing the privi- leges of the system, asking them to discontinue the use of it as a cur rent account institution, because of the increased expense to the Govern ment, and use it only for savings.
 From the books of many thousands of the smallest of the English deposi- tors, the Department compiled sched- ules showing that these depositors in variably paid in small sum at the end of one week, only to withdraw part or the whole of it at the be- ginning of the next week. On single deposits of one or two shilings a num- Der of persons drew more than sev- enty times last year, without having at any time had more than two or three shillings-that is, fifty or sev- enty-five cents-to their credit
 It is reasonable to assume that we should have many thousands of sim ilarly small and time deposits, with much ridicuously small checking against them, if we established Pos tai Savings Banks and Congress in considering the subject should give proper weight to this troublesome and costly feature of Postal Savings Bank business We should profit enough by England's experience to avoid it.
 Our government is strong enough to dispense with all factitious and ad- ventitious aid, and all doubtful means, in the management of it's finances, and resourceful enough to be entirely Independent. It needs neither Postol Savings Banks nor a Central National Bank. These, I repeat, would be ex- periments; and financial experiments in new directions are always danger ous and disturbing. Conservatism should be our watchword and all ra- dical measures should be studiously avoided and frowned upon, in the in- terest of the country's trade and com merce, as well in the interest of good banking and financial stability.
 Instead of Postal Savings Banks, it would be better for Congress to au- thorize the National Banks to estab- fish savings departments on a basis of ten per cent. special reserve for such deposits. This would meet the possi- ble requirements of some of the peo- pie, particularly of those in thinly set tied localities, where savings banks are as yet few and far between.
 So let us hope and pray that we shall have neither Postal Savings Banks nor a Central National Bank in this country, but let well enough alone and-in the future as in the past go on our way prospering more and more, to the glory of the United States of America and the wonder of the