The Wenatchee daily world. [volume] (Wenatchee, Wash.) 1905-1971, 1910-12-08
j, 5, TREASURY
SUBMITS
REPORT
Asks for Currency Reform
and Extension of National
Banking Laws.

! Washington, Dec. S-Currency
reform; extension of the scope of
the national banking laws, in the
event of no immediate general
changes in the monetary system !;
civil service retirements, a customs
! service free from ''practicaI' politics;
| businesslike methods in the daily
| transactions of the government and
! a general abolition of red tape
wherever it clogs the wheels of the
| government business, are among
| the recommendations contained in
the annual report of Franklin Mac
| Veagh. secretary of the treasury,
presented 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 S630,490, 013.12. The
estimated expenses of the Panama
canal are given as $56,920,s47.69,
making a total of s6S7,414,S60.S1.
The estimates if carried out, repre-
sent net savings of about thirteen
million in the executive departments,
as compared with the appropriations
for the current fiscal year. Receipts
| for 1912. Secretary MacVeagh esti-
mates, will be $6S0.000, 1000, which
would leave an ordinary surplus of
round $50,000,000. If the treas
ury should continue to pay for the
Panama canal out of the cash draw
er as at present. such surplus
would be turned to a deficit of ST.
| 414,S60S1.
| Secretary MacVeagh expresses the
hope that the monetary question will
come into congress detached from
sectional 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 PAN
| ic-preventing. AS long as we con-
are liable to panics and the devasta-
| tions of panics reach republicans and
| democrats and all parts of the coun-
try alike. Panics are no longer ne
| cessary or respectable. 1t is for the
1
government to say whether we shall
have panics in the future or not. 1t
| is choice.
1--WE have no system of reserves
Our banking system destroys them.
| 1t concentrates in New York what
are pretended to be reserves and
then forces the New York banks to
| lend and abolish them. Our sys-
| TEN, instead of building up reserve,
destroys it, as fast as it inclines to
accumulate"
In connection with his criticism of
the money system, one of his most
! important recommendation con-
Germs future issues of Panama bonds,
of which S290,000,O00 were author
! lied by the tariff act. The secretary
| last year for legislation to tax the
new bonds at 1 IL per cent if used
| by national banks for circulation,
and intimates, as was announced in
news dispatches a few days ago. that
it might be more preferable to issue
the new securities for investment
purposes only at rate of per cent.
AS check against the use of the
bonds as the basis for a further in
fation of the national bank currency,
he suggests that a circulation tax of
even two 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 per cent bonds, of
which more than s7OO.00O.O0O are
outstanding. Another means of ac-
comprising the same end, the sec
rotary suggests, would be for con-
gress to authorize an issue of $780,
100000 or 500. 100000 of the bonds
at per cent, without the circula-
ton privilege. If there is no pros
pect of immediate change in the
monetary system, the secretary
thinks the American national bank
ing system should be developed to
perform an international function.
There is a clear need of banking
facilities in foreign countries where
there is American commerce" he
says. I'VE shall never be a full
fledged commercial nation" he con-
tinues, unless we have merchant
ships of our own and foreign banks
of our own. We should have banks
at all points that are important to
our commerce"
The treasurer's relations with the
business community are unbusiness-
like, artificial and burdensome, the
secretary declares, and he recon-
mends legislation to permit the pay
ment of revenue to the government