The Bemidji daily pioneer. [volume] (Bemidji, Minn.) 1904-1971, 1911-01-18

With Branch of the Association in
Each District:
Washington, JAM. Ex-senator Mel
son W. Aldrich's long awaited "plan
for the revision of the national bank
ing legislation" as he himself calls it,
has been made public. 1t does not
contemplate the establishment of
central bank. It is so far from what
most people have expected Mr. AL
drich to propose that. to those who
have not been in his confidence it may
come as a notable surprise. -
The plan was submitted to the ma
tional monetary commission at meet
ing called for the purpose, but Sen
ator Aldrich was not present. There
was a suggestion almost of the tragic
in the fact that when the hour came
for the formal PRONUNCIATION of what
Senator Aldrich is known to regard as
the browning constructive effort of his
life he was hundreds of miles away,
speeding to the South on a compul-
sorry search for health. His communi-
cation was presented to the commits
sion by the vice chairman, Represen-
tative Vreeland of New York.
Far; from recommending the insti-
tuition of a. central bank Mr.. Aldrich
expressly disclaims belief in it.
"While. we have found much that
is admirable in the government banks
of Europe none of them is applicable
to our needs. Good results can, I be-
lieve, be reached without a central
bank"
What Mr.. Aldrich does. propose is
the establishment Of the Preserve As.
ISOLATION of America" federation of
local associations, formed by national
banks.
AIdrich Plan in Brief.
Under Senator Aldrich's plan the
country would be divided into fifteen
districts, with a branch in each dis
trict, each branch to be made up Of
local associations There would be
forty-fve directors in the reserve as
sociation, three for each branch with
of the treasury, the comptroller of the
currency, the secretary of commerce
and labor and the governor and two
deputy governors of the association.
The reserve association would be
the principal fiscal agent and deposit
tary of the government, would fix
rates of discount and eventually its
notes would replace those of national
banks, which would gradually sbe re-
tired and not be reissued.
In addition to rights now enjoyed
national banks would be authorized to
accept commercial paper having not
more than ninety days to run, to the
extent of one-half the capital and sur
plus of the banks.
Two new classes of national banks
are provided for, one to have savings
departments and make loans on real
estate and another to exercise the
functions of trust companies.
Currency emergencies would be met
by a system of mutual support, in
which all members of the association
would participate.
Reserve Fund for Earnings.
National banks having minimum
capital of $4,000 may subscribe to
stock in the reserve association to the
amount: of rs per cent of it's own
stock Earnings of the association
are to go into a reserve fund and to
be divided between the members and
the government in designated proper
tons.
In addition to authority to issue
notes to replace those of national
banks the reserve association would
have authority to issue additional cir
culating notes and the whole or any
part of the first $1OO,OO0,0OO of such
additional notes would pay a tax of 3
per cent to the government above
$1O0,O00,0OO and not more than $780,
000,00 could be issued at an annual
tax of per cent, and above $200,000,-
900 and not more than $3O0,O00,000, at
a tax of 5 per cent, and all above
$500, 100000 would pay tax of 6 per
cent.
All note issues of the association
must be covered to the extent of at
least one-third by gold or other lawful
money. and the remainder by United
States bonds or bankable commercial
paper.
The capital stock of the association
would be- $3OO.OOO,00 and the asso-
citation and it's branches exempt from
taxation except upon real estate.