The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1910-12-09
PANIC DISGRACE,
SAYS MACVEACH
Financial System Breeds Money
Scares, According to Secre-
taTy of Treasury.
ANNUAL REPORT ASKS SUM
TO APPLY ON NATIONS DEBT
More Than Fifty Millions Will
BE Spent on Panama Canal
in Year.

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 retire
ments. a customs service free from
,praciicalr politics; busipesslike meth.
DDS IN the daily transactions of the gov
ernmcnt and general abolition of red
tape wherever it clogs the wheels Of the
governments business, are among the
recommendations contained in the an
uual report Of Franklin MacNeagh, sec
rotary Of the treasury, presented to
congress today.
The expenses Of government IN the
fiscal year 1912. for which this session
Of congress is asked 80 appropriate. are
estimated at $500, ,494, ,0l3,le. The estl-
mated expenditures of the Panama
canal arc given as $56.92O ,s4i SO, max
ing total of $6S7 .il4 ,S60.S1. The esti-
mates. if carried out, represent net saw
ings of about $l3.000.000 in the execu-
tive departments. as compared with the
appropriations for the current fiscal
year.
Canal Would Cause Deficit.
While The secretary's report csti-
mates the total expenses of government
at $GS7 ,4l5.s60, the estimates which
have been transmitted To congress ask
for S74S,il4.S6o. difference of SOL
100000 Congress is asked to appro-
pirate this extra SCI 100000 TO make
the sinking fund law effective, 1t would
be an appropriation TO permit the treas.
ury to begin apply ing | per cent year
TO the discharge of the national debt.
The law authorizing such procedure
1-I- e
as congress has never appropriated any
money.
Receipts for 1912. Secretary Mac
Veaeh estimates. will be $3.50 100000.
which would leave an ordinary surplus
of round $50.o00,o00. 1t the treas
ury should continue TO pay for the
Panama canal out Of the cash drawer,
as at present, such surplus would be
turned TO n deficit of $7.414,S ,S60.S1.
Secretary MacVeagh expresses the hope
that the monetary question will come
int, congress detached from sectional
or political considerations.
tOur system can fairly be called
panic breeding system he says,
.'wbereas every other great national
banking and currency system is panic
preventing. As long ss We continue
under our present system we are liable
10 Us MICS and the devastations of panics
REACH Republicans and Democrats and
all PARTS of the country alike. Panics are
no longer necessary and no longer re-
spectacle. 1t is for the government TO
say whether We shall have panlcs in the
No System Of Reserves.
s.We have no system Of reserves; our
bapxing system DESTROYS them It con
centrates in. New York what are pre-.
tended TO be reserves and then forces
fhe New York banks to lend and abol
ish them Our syst en-. Instead of build
ing up reserve, destroys it as fast as
ii inclipes to accumulate"
In connection with his criticism of
the money system, one of the secre-
tarv IS most important recommendations
concerns future issues of Panama bonds
of which 5000 100000 were authorized
hv the tariff act. The secretary reuews
the recommendations made last wear for
legislation to tax the new bonds at Il Z
per cent if used by national banks for
uouuced in news dispatches few DAYS
ago, that it might be more prefera BILE
10 issue the new securities for invest.
:nent purposes only at rate of 5 per
cent.
rs check against the use Of the
bonds as the basis for a further infa-
iion of the national bank currency. he
suggests that a circulation tax of even
> per cent would have the effect of
making them improbable for banks to
nse for such purpose and at the same
time would make them attractive TO in
vestors without inluring the per cent
bonds, Of which more than 800 900 900
are. outstanding. Another means of ac-
compIishing The same end, the secre-
ta'ry suggests would be for congress to
authorize an issue of S5o,0OO,OO0 OF
S10o.000.000 of the bonds at 3 per cent
without the circulation provisions If
there is no prospect Of imm Mediate
change in the monetary system, the sec
rotary thinks the American national
banking system should be developed TO
perform an international function
Wants American Merchantmen,
''fhere is a clear need of banking
facilities in foreign countries where
there rs American commerce. he saws
.'We shall never be a full fledged
commercial nation he continues, Sun
less we have merchant ships of our own
and foreign banks Of our OWL We
should have banks at all ports that are
imnortaut to our commerce.
The tTeasurv's relations with the
business communities are unbusness-
like, artificial and burdensome, the
secretary declares, and he recommends
legislation to permit tho payment of
revenue 10 the government by cert.
fed check. guarding the government
against loss.
Tho recommendation that the treas
ury he authorized 10 issue gold certii-
Gates AGAINST gold bullion and foreign
gold coin is renewed.
Reviewing the discovery of frauds
and the subsequent reorganization OF
the customs service, Secretary Mae.
Ncagh urges appropriations for rewards
TO those who aid the government.
Pats Loeb on the Back.
The rehabilitation of the customs
service al New York has been marked
no says. by decided elimination OF
snoiis. influences and Hpractical poll
tics
American travellers are more an6
more realizing the indefepsibleness oi
smuggling, its rank dishonesty and baC
eHamDle and influence says the re