Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1910-12-08
SECRETARY MAcVEAGA PLEADS
WITH CONGRESS FOR FiNAN-
clAL REFORMS.
FOR CUSTOMS SERVICE
FREE FROM POLITICS
Urges Abolition Of Federal Red Tape
Wherein il Clogs Business Of Gov.
srnmsnt-Want Tax Imposed on Fu-
turs Issues Of Panama Bonds-TeIe-
graphic News.

washington, Dec. S.-Currency re-
form; extension of the scope Of the
national banking laws, in the event OF
no Immediate general change of the
monetary system; civil service retire
,nents; q customs service free from
practical" politics; business like meth
ods in the daily transactions Of the
govern ment and a general abolition OF
yed tape wherever it clogs the wheels
of the governments business, are
among the recommendations contained
in the annual report of Franklin Mac
Veagh, secretary Of the treasury, pre-
sented to congress today.
The expenses of government in the
fiscal year 1912, for which this session
of congress is asked to appropriate, are
estimated at s630,494,O13.12. The esti-
mated expenditures on the Panama
canal are given as $56,920.S47.69. maxi
ing a total of $6s7.414,s6 The estl-
mates, If carried out, represent net saw
ings Of about $1s.000000 in the execu-
tive departments as compared with the
appropriations for the current fiscal
year.
While the secretary's report esti-
mates the total expenses Of the govern
,nent at s6s7.414,s60, estimates trans
mitted to congress ask for s74S,414,S61.
Congress is asked to appropriate the
difference, $61,000.000, to make the
sinking fund law effective. 1t would
permit the treasury to begin applying 1
per cent per year to discharge the ma
tional debt. The law authorizing such
procedure has been a dead letter for
some time, as congress has never ap-
propriated any money.
Receipts for 1912. Secretary Mac
veagh estimates, will be $3.50. 100000
which would leave an ordinary surplus
of around s5o,0oo,0oo. If the treasury
should continue to pay for the Panama
present, such a surplus would be turn
ed to a deficit Of s7.414,s6O.s1.
Panic-ereedins System.
Secretary MacVeagh expresses the
hope that the monetary question will
come into congress detached from Sec
tional or political considerations.
"Our system can fairly be called a
panic breeding system" he says,
whereas every other great national
banking and currency system is panic
preventing. AS long as we continue
under our present system we are liable
to panics and the devastations Of pam
ics reach republicans and democrats
and all parts Of the country alike. Pam
les are no longer necessary and no
longer respectable. 1t is for the gov
ernment to say whether we shall have
panics in the future or not. 1t is Il
mere matter Of choice.
1--WE have no system of reserves; our
banking system destroys them. 1t con-
centrates in New York what are pre-
tended to be reserves and then forces
the New York banks to lend and abol-
fish them. Our system. instead Of
building up a reserve. destroys it as
fast as it inclines to accumulate.
Panama Canal Bonds.
In connection with his criticism of
the money system, one Of Secretary
MacVeagh's most important recon-
mendatfons concerns future issues Of
Panama bonds of which $290.000. 900
were authorized by the tariff act. The
secretary renews the recommendations
he made last year for legislation to
tax the new bonds at 11s per cent. if
used by national banks for circulation
and intimates, as was announced in
news dispatches. few days ago, that
it might be more preferable to issue
the new securities for investment pur-
poses only at a rate of per cent.
AS check against the use of the
bonds as the basis for a further infla-
ton Of the national bank currency, he
per cent would have the effect of
making them improbable for banks to
use for such purpose and at the same
time would make them attractive to
investors without injuring the 2 per
cent bonds of which more than $780,
900, 900 are outstanding. Another means
OF accomplishing the same end, the
secretary suggests, would be for con-
gress to authorize an issue of $50,000,-
900 or 310O,OOO,OO0 of the bonds at
per cent without the circulation priv
iiege.
II there is no prospect Of immediate
change in the monetary system the
secretary thinks the American nation
al banking system should be developed
to perform an international function
There 10 clear need Of banking fa-
cilities in foreign countries where there
is American commerce. he says.
Reorganization Of Customs Service
Reviewing the discovery Of frauds
and the subsequent reorganization Of
the customs service. Secretary Mac
veagh urges appropriations for rewards
to those who aid the government. The
rehabilitation OF the customs service al
New York has been marked, he said
by a decided elimination OF spoils in
huences and practical politics.
"American travellers are more and
more realizing the indefensibleness OF
smuggling, its rank dishonesty and its
bad example and influence" says the
report.
Recommending study Of the classi-
fed system OF employees the secretary
declares that civil service retiremen.
10 absolutely the requisite of satisfac-
Yorv svstem. The coutributory system