The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1910-03-05

replied Mr. Smoot, "but we assume
they would have
"Not necessarily so.' replied Mr..
Gallinger, ''if they were aliens. as the
depositors many of them, would be.
Senator Roots Stand.
Senator Root took the floor To urge the
necessity OF putting the bin on constitu-
tional basis. His idea was TO afford the
people an opportunity TO invest their
earnings. he said, and at the same time
put themselves in the position OF support
Ing The government.
With the end i'm View OF establishing
such n system, he said. he had introduced
his amendment providing for the Invest
ment of funds in government securities
and expressed the opinion that without
some such provision the bill would be IN
valid
The whole scheme. he said. was to
provide for system OF deposits IN IN me me
postoffIces and of the redeposit OF the
funds IN another neighDoring bank ana
OF Keeping them there until returned TO
the depostors, the government of the
United States merely acting as the agent
and guaranteeing the deposit such
system was widely different from any
postal bank or savings bank that ever
had been known, ne said ana ne did not
believe IL would commend itself to the
business community.
The Smoot Amendment,
On the other hand he thought that
either his amendment or senator Bur
tons amendment. both OF which look 20
the Investment OF the postal FUNDS IN
government securities would bring the
system within the borrowing power oi
the government and furnish clear con con
Shoots amendment was the farthest eN,
tent towards which the committee had
felt able to go in the direction he had
thought necessary.
1T is not satisfactory to me. he said.
at does not go TO the extent that /
wish IL should. but think u does iurhiSl
probable constitutional basis TO the
aw as it puts the deposits in such posi-
ton that the government can call on
them whenever IL has real need;
For this reason. and especially as ne
considered II impossible TO get anything
better. Mr.. Root said he would he Wiling
to accept the Smoot provision but ne
thought It should remain unchanged, The
Cummins modification he pronounced
worthless and equivalent 10 wiping OH
the statutes any provision Tor govern
ment investment as one OF the purposes
in the bill.
Serious Phase of Case.
Mr.. Root pointed out the serious as
pect OF the assumption by the government
of obligations which probably would
amount TO 100000, 600, and which would
be secured by no resources except the
deposits in the banks,
or these banks, he said there were
more than 22.O00. state and national
Most OF them were safe. but some prob
ably were not. Moreover. no reserve was
TO be required. and 1t should be borne In
mind, he continued. that by no means ali
OF them would be under government or
state supervision.
Mr. Root said it was generally admitted
the countrys financial system was a
misilt, and n consequence ii happened
that when the strings Of finance were
drawn tight the system was sure To he
pulled the wrong way On such occa-
stons the banks were unable TO pay, con-
hdence. was lost and panic ensued.
He felt competent. he said TO speak
on this subject. for, either on account of
official or professional connections, ne
had been in a position OF responsibility
hat of 1878.
Sees Danger Ahead.
when such times as those come,
where will this bill leave the government
OF the United States. with Its $oOO,OOO,-
00c OF obligations TO postal savings bank
depositors. and without any security eX-
cept that supplied by the banks. which
can no more pay the government than
they can pay anyone else?' asked Mr.
Root.
Instead OF the bankers and brokers
going to the wall the treasury OF the
United states will suspend payment, the
stroyed. Then what VIII become OF the
Industrial system OF the country"
In all past financial trouble the gov
ernment had remained solvent. he said,
1t had stood like a rock and there had
never been any lack OF confidence since
the resumption OF specie payments in
With tho pending bill adopted he
feared the obligation would be greater
than the government could carry.
thrift" said Mr.. Root. "but there rests
upon us higher duty, and that Is the
maintenance of the credit of the coun-
try, and on my oath as senator OF the
United States l cannot give my assent
to a measure which Will lmperil that
credit and which would endanger the
good name OF our country and the perpe~
tuity Of its prosperity. l therefore beg
of you not TO permit any consideration
to lead away from the pathway OF
safety and constitutional right"