The Detroit times. [volume] (Detroit, Mich.) 1903-1920, 1910-12-08
URGEs REFORM TO
PREVENT PAN|Cs
Secretary of Treasury Submits An
nual Report-Economy Is Also
Feature Of Document.

WASHINGTON. Dec. S.-Economy
that beats all records is one Of the
features OF the annual report OF Secro-
tar Franklin Macveagh. OF the treas
ury department. which was sent TO
congress today.
The estimated ordinary expendi-
tuIes for next year amount to $3.50
49i.0lS. Including Panama canal eN-
penses-s56, 920sl7, which will be re-
paid to the treasury by the sale OF
bonds--the grand total Is $6s7 .il4,Soo
The total appropriations Tor tais year
were $72l,313,900.
The appropriations for the ordinary
expenses OF the government were, for
1910, 93,313. 1876: for 1911. 1888, i5s.-
900. The estimates for the next fiscal
year. beginning July 1, are s630,4si'-
0l3
There are difficulties In the way oil
making an estimate or next years re-
celpts. but in the best light available
Secretary MacVeagh places the
amount at $780, 100000. These ordin-
airy receipts IL realized, viii exceed
the ordinary disbursement by Si9.50o.-
9S6. But taking also into account the
estimates for the Panama canal the
deficit for the next year Will be ST.
4l4,SG0.
Reform OF the currency Is the next
suLje considered. Concerning II Sec
rotary MacVeagh says:
1--WE can continue to have panics or
we can stop having panics, exactly
as we prefer IL will not cost penny
10 prevent them; and II has cost US
untold millions and untold suffering
every time we had one 1t Is for the
government TO say whether II will
have panics in the future or whether
IL will not"
Short as the present session Is To
he. the secretary says, ii would be a
Great step forward II the subject OF
"a remedy for existing financial condi'
lions could at least arrive at some
form OF defniteness and concentra-
ton before congress adjourns. II has
received great consideration during
the past two or three years by econ
omic authorities under the lead OF the
National Monetary Commission. There
should be no need OF further hesita-
ton, he believes, In taking action.
The whole financial history OF the
country" according TO the report. lis
a long series OF troubles and agitation,
and now that we have in sight the
establishment OF a real and perman-
ent banking and currency system that
will be both safe and sane, II makes
one anxious to see IL accomplished.
AS to the weaknesses OF the panic
breeding system" Secretary Mac
Naaoh daclaraa. s'yNa have no system
OF reserves. Our banking system de-
stroys our reserves. 1t concentrates
I'm New York what are pretended to
be reserves and then forces the New
York banks to lend and abolish them.
we have no way to increase our
currency when IL is needed, except
under the Aldrich-vreeland law, which
will soon expire and which Is only
intended for emergencies. Under our
system ordinary transactions OF busi-
ness cannot go forward uninterrupted
in a time of stress and strain And
yet the final test of banking and cur
rency system Is that the ordinary
banking facilities needed by business
shall he provided at all times and UNI
der all circumstances"
The continuing deficit created by
the Panama canal expenditures, the
report says, Is bringing closer the time
when the Indebtedness of the canal TO
the general fund OF the treasury will
have 10 be paid, at least in part, by a
sale OF some Of the Panama canal
bonds authorized by congress to the
amount of $290,569,000. These may
be issued at any rate of interest neces-
sary up to three per cent. If the
bonds are to be used as a basis for
bank circulation, the secretary points
out. the tax on the circulation should
he lR or 2 per cent IN order to pro
tect the per cent government bonds
now held by the banks. On the other
hand. If authority were given 10 is
sue $4,000 900 or Sl00,000,000 3 per
cent bonds without the bank circula-
ton privilege, II would be possible TO
gauge experimentally the rate at
which the government could borrow on
an investment basis, and officials
would then be better able to formulate
a financial policy for the future.
AS to customs, the report in part
says: THE sugar frauds were found