Tulsa daily world. [volume] (Tulsa, Indian Territory [Okla.]) 1905-1919, 1911-10-20
PROVIDES CENTRAL SCHEME
HAVING A CAPITALIZATION
or 800 MILLION DOLLARS.
NO SECTIONAL CONTRACT
CHIEF 10 BE Chosen by President
State Banks, TO Share In Results,
Must Conform to the Laws.

WASHINGTON, Oct. 19.-Former
Senator Nelson w. Aldrich of Rhode
Island today submitted to the Nation
Al Monetary commission. of which he
he Is chairman, his plan for none
tary legislation. The preconceived com
mission may use II as the basis of its
recommendations to congress.
The basic principles of the revised
plan are substantially the same as
those embodied in Mr.. Aldrich's first
proposal, sent to the commission last
January which he said ne expected
would serve as a basis for national
use. They will be treated in recon-
mendatlons sent to congress. Most of
them are handled in details as result
of the decisions and conferences
which have been going on since the
plan was first suggested
What the Plan Provides.
Briefly, the plan still provides for
the organization Of the National
Reservation" with capital Of approx
mately 800 million dollars, in which
the United States and the banks own
ing shares In the association shall be
the only depostors. The plan Of d.
viding the United States at first into
fifteen financial districts remains un-
changed.
Section control Obliterated.
In each district the banks shall
form local associations Of their own,
which, In turn, will be represented in
the branches, and finally In the CEN
tral organization through vote OF
directors, who will make 1t impossible
for any section or sect Of bankers to
control the whole.
To Absorb Bonds In Banks.
To provide for the $73O,OOO, 900 Of
per cent government bonds now owned
10y the National banks and used as
the basis of note circulation, which
are to be absorbed by the reserve as
sociation, the following plan is pro-
posed:
Upon the application of the reserve
association, the secretary of the
treasury shall exchange the per cent
bonds which the association will buy
from banks at par and accrued in
terest, for new issue of 3 per cent
securities, payable fifty years after
the date of issue"
A special Franchise Tax.
The reserve association will pay II
the government a special franchise
tax Of per cent year on the amount
of such bonds. The governments
actual interest charge of the 2 per
cent is not actually u per cent as
the banks pay back y per cent as
tax when the bonds are used as
the basis of note circulation. This
will reimburse the government for
the extra interest 1t will be called
upon to pay as a result of exchanging
Che 2's for 3's.
Public Debt Provision.
one effect of the exchange Will be
to enable the government to provide
permanently for large portion of
the interest-bearing public debt at
net charge of y per cent.
This arrangement proposes a solu-
tion of what many financers declared
the greatest obstacle to the plan. 1t
disposes permanently Of the bond-se-
cured currency without loss to the
government, without imposing on the
reserve association and the $73O,O0O,-
Geo per cent bonds
Hold Bonds Fifty Years.
The association will agree to hold
the per cent bonds for fifty years,
hut the secretary, after five years,
win have the option Of permitting the
association to sell the securities at a
rate not greater than S5O,00O,00O a
vcnr. The government may reserve
the right to redeem any of the bonds
before maturity. or to buy any OF
trem at par for the trustees of the
postal savings.
To Be Forty-fiye Directors.
Provisions for the election Of d.
rcctors have been changed In the re-
viscd plan with the idea Of minimiz-
ine the possibility of control by sec
ticn or group. There will still be
forty-five directors. as in the original
plan, six members each. viz:
The governor of the association,
his two deputies the secretary OF COM
merce and labor, and the comptroller
of the currency.
How Directors Are Chosen.
Each of the fifteen financial dis
tricts of the country will elect one di-
3 rector. twelve others will be elected
by the shareholders. and these twen-
ty-seyen will elect to the board twelve
additional members. who shall not be
officers of the banks. but may be d.