Los Angeles herald., 1910-03-06
SENATE PASSES
POSTAL SAVINGS
BILL, so TO d
Administration Measure Is
Strongly Opposed by
Democrats
LIMIT ON DEPOSITS
War Only Exigency Justi-
flying Withdrawal of
Funds by Govt.
tAssociated Press1

n
w ing practically upon party lines,
the senate at the close Of the
third session of the legislative day of
March 3, today passed the administra-
tion postal savings bank bill
OF the ~ votes cast, 30 were In ia
vor of the bill and % against it. All
the negative votes were cast by Dem
ocrats, even Mr.. McEnery, who har
voted with the Republicans throughout
the consideration of the bill, in the end
deserting to his own party.
Senator Chamberlain Of Oregon was
the only Democrat who stood with the
Republicans in favor of the bill
AS it goes to the house the bill au-
thorizes the various money order de-
partments in postoffices to accept sums
of 81 or more from depositors and to
deposit these in the local banks, where
the money is to remain unless with
drawn by the president in case of war
or other eXigency.
In case of this withdrawal the funds
! are to be invested in government Sc
curities, but with the proviso that
such securities shall draw not less than
"a per cent interest. The control OF
the funds is vested in board of trus-
| tees composed of the postmaster gem
| eral, the secretary of the treasury and
the attorney general.
Deposits Are Limited
The aggregate balance allowed to
any depositor is $500 and no person
IS permitted to deposit more than 500
in any one month. The government is
required to pay per cent interest and
must exact not less than PA per cent
from the banks, the extra quarter or
1 per cent being required for the pay
ment of expenses and losses.
1t is calculated such a law would
bring much money out of hiding and
result in a fund ranging all the way
from $500, 100000 to $1,000, 900.
Beginning at 11:45 this morning the
senate continued until 4:50 p. M, and
practically all this time was devoted
to the consideration of amendments.
Almost Immediately after the session
began the first. vote was taken. This
was on the Cummins amendment to
| the Smoot amendment, upon which
yesterdays debate waged so fiercely.
The Smoot amendment looked to the
authorization of the withdrawal from
local banks of the postal funds in case
of war or other exigency and Mr..
Cummins sought to modify it by MAX
ing it apply to war as the only exl-
gency justifying Withdrawals. The
Cummins provision went down under
a vote of 40 to 10, the affirmative vote
being cast by the so-called "insurgent
Republicans and half a dozen Demo-
Gratis, with the single exception or
Senator McCumber, a stalwarr Repub-
lican.
Later in the day, and after consid-
erable debate, the Smoot amendment
was adopted after it had been modified
by the insertion of an amendment in
troduced by Senator Borah, directing
that the funds withdrawn should not
be invested in government securities
carrying less than "a per cent inter-
est, the rate required from the banks.
important Amendments Adopted
Two other important amendments
were adopted. One of these was by
Senator Bailey, and would permit the
withdrawal of postal fund deposits by
the original depositors upon demand"
and the other by Senator Gallinger,
specifically including savings banks
and trust companies doing a banking
business among the banking institu-
tions permitted to accept deposits OF
postal funds.
The "insurgents" we're much elated
over the acceptance of the Borah mod
ifcation They contend 1t will reduce
to a minimum the government securl-
ties in which postal funds may be in
vested and will prevent the national
banks from using the funds to relieve
themselves of class OF securities
that are not popular with them.
MIR. Carter, in charge of the bill,
made no objection to the Borah
amendment The provision was agreed
to, 40 to II.
Several amendments were voted
down. the most important being one
offered by Mr owen of Oklahoma, in
tended as a substitute for the whole
hill. and which provided for the es-
tablishment of a fund to guarantee
national bank deposits.
The sharpest discussion or the DAY
arose over Mr.. Gallinger's amendment,
including savings banks ana trust
companies in the specific terms of the
bill. II was bitterly opposed by Mr..
Heyburn and in less degree by Mr..
Bailey. Mr.. Hepburn said If this pro-
vision were retained the bill would be
repudiated by the people. Mr.. Gal
linger contended that to include un-
certain state banks and exclude the
most stable banks of tine country
would be inconsistent.
Large Force Necessary
Mr.. Bailey, replying, said the work
would be so distributed over the couh-
try that it would be impossible to get
along without large extra lorcS.
An amendment looking to a change
Of nhraseology called out bitter as
sauIt by Mr. Hepburn. 1t provided
that no interest should be computed on
fractions of a dollar. 1t was adopted
after an extended debate.
A number of Democratic senators,
Including Messrs. Gore, Stone and
Bacon, spoke in general opposition to
this measure. They saw in it the fore
runner of a great central bank and re-
garded the legislation as unconstitu-
tional.
There was little apparent interest on
the floor or in the galleries as the time
approached for taking the vote. Sena-
tor McCumber, who was presiding,
created the only ripple when by mis-
take, he said, after Senator Cullom
had moved an executive session: "The
galleries will be killed and the doors
closed" meaning, OF course. to say the
galleries would be cleared and the
doors closed.
The postal savings bank bill had
been before the senate since January