The herald and news. [volume] (Newberry S.C.) 1903-1937, 1910-03-29
Will Help Banks.

proposal we're disposed to oppose the
establishment Of the postal savings
system. As Mr.. Taft has recently
stated in public address it will be
a positive benefit to the banks. In
the first place, the banks now are
paying 4 per cent.-that IS, IN most
places-on their small accounts. On
these savings deposited in the post
offices and redeposited in the banks,
they would have to pay only 2 IA
per cent. interest. It is claimed by
the advocates Of the proposal that
under the system there would be
much more money deposited, more
people will open accounts, money
would come from chimney corners,
cracks in the walls, between mat
tresses, old stockings and other
homely and traditional receptaeles.
The banks would, therefore, say
these advocates, get more money
than they get now from small depos-
its. 1t would be easier for the banks,
moreover, for the postofice depart
ment would deposit money in lump
sums, and relieve the bonks Of the
burden Of so many small accounts.
No banks are to be Disseminated
against, it being specified hat the
deposits shall be placed in ''any SOL
vent bank or banks, whether orga-
nized under national or State laws,
being subject to national or State
supervision ana examination, and
doing business in the city, town or
village in which the postofice IS sit
uated." The apportionment of the
deposits among the various banks in
the city, town or village, is to be
Substantially according to their
capital and SURPLUS
In the case Of country postofices,
where there are no banks, the money
is to be deposited i'll banks of the
State in which the postofice is Sit
uated "giving preference to those
that are in the same general commu-
nity.' The banks are to give either
indemnity bonds or some collateral
security as a guarantee of the Safe
keeping Of the postal deposits.
Chief Objection.
The chief objection to the bill as
passed 50 far as its practical opera
ton is concerned, that is apart from
the fact that it is wholly unconstitu-
tional, is the power it gives the pres
ident to take away the deposits in
the local banks and invest them in
bonds; and that is the principal
reaso,. the Democrats did not vote
for it. There is provision that,
"when in the judgment Of the pres
ident, war or any other exigency in
volving the credit Of the government
so requires, the board Of trustees may
withdraw all or any part of sand
funds from the banks and invest the
same in bonds or other securities Of
the United States,'' it being speci-
fed, however, that such securities
shall not bear less than 2 IA per
cent.
The so-called "insurgent" Re-
publicans Of the senate opposed this
provision until on motion Of Sena-
tor Cummins Of Iowa, the provision
was put in specifying that the seeu-
rites shall bear more than 2 per
cent. These feared, they said, that
the deposits might be used to take
up the 2 per cnt, bonds usd as a
basis Of circulation issued by ma
tional banks. But the Democrats
objected to giving the president or
the board of trustees, which IS to
consist of the secretary Of the treas
ury, the postmaster general, and the
attorney general, any power to take
the peoples savings out of the COM
munity in which they are deposited.
Even in time Of war, they say, the
people should be able to get their
money on demand at any time. But
they might have been willing for the
United States government to have
such a power in time Of war, but
"any other exigency involving the
credit Of the government" might
be construed and is believed to be
intended to be. construed to mean
any time Wall street or the bankers
thereabouts in New York get into a
tight place and want the assistance
Of the government at Washington.