Virginia free press. (Charlestown, Va. [W. Va.]) 1832-1916, 1912-12-19
he Wage Earner's Interest In
Banking Reform.

at HE mercy of The conditions created
by the present nnecientific system. Hs
can least affo-'la psnic
The present aati MI ankinr syster
has won just praise fur the facts hal
| It's notes nave always been rfd. em4hle
ct their fare value and that the losses
to depositors have been comparatively
Issmall. But it has failed signalIy. or
more than one occasion, ID the perform
ance Of its larger duty, This is one Of
the severest criticisms of the present
system. It's mechanism is SO faulty and
unstable that il has been known to
break down. even Whescdndit soM56ther-
wise were prosperous. 1t is panic
breeder.
The wage Garner is more dependent
than any other man whpon continued
prosperity, and any system which does
not rebound to his advantage 10 I'M
worthy of respectful reconsideration. He
may be bank depositor on small
scale; but, whether or not he is that,
he is first to feel the effects of panic,
and he feels it more keenly.
A concrete illustration of what hap
pens in panic may be in the records
of the Chicago Relief and Aid Society
(now called the United Charities) in
1907. Prior to that panic, the society
was spending f.om $4,000 to $45, 600
a year, and handling from 5000 to 5000
cases. In1907, its expenditures jumped
to $125. 900. with more than double the
number of cases. In addition to that,
the Central Relief Association was
created to meet the emergency. and it
spent about as much as the other or
ganizstion.
In other words. thousands of INDUS
trious workmen in Chicago land the
same thing was true everywhere in the
United States) finding themselves
disemployed, through no fault of their
own. were forced to the humiliation Of
soliciting public charity.
When manufacturers and others in
the business world are able to procure
readily and at reasonable rate of
interest the capital necessary for their
business, their plants are continuously
busy, they pay wages promptly and
they can offer steady employment
But if the banks are unable to extend
accomn odation, the flow of funds is
checked and the employers are forced
to discontinue business or to cut down
their expenses, it is done usually by
some of their employees,
because the payroll is the largest item
of outlay, az a rule, in a commercial
establishment. This n ay happen. even
though the business is profitable and
and even though the pro-
prietor may earnestly desire to con
tinue it
In such an event the employer, hav-
ing funds for his personal uses and
extensive credit with tradesmen, does
not feel it nearly SO keenly as the la
borer thrown out Of employment, who
may have little or no money laid aside
and who finds it difficult to get an ex-
tention of credit from his butcher, his
grocer, his landlord or his clothier.
Banks are sometimes unable to ex-
tend accommodations to employers of |
advance money, let us say,
for the weekly payroli--hecause they
cannot convert their. assetsN into cash.
They cannot lend more money when
their cash reserves fall below a certain |
legal limit, and they stop lending be-
fore that limit is reached. as a matter
Of precaution. They may have excel
lent securities on which. in ordinary
times, they would have no difficulty in
funds; but in times of special
strain these assets prove useless be-
cause other banks, from which they
might get assistance, are in similar
straits or are protecting themselves.
The present system makes every bank
dependent on itself. without the privi-a
lege of going to any other bank for
help except as a matter of favor. 1t
cuts them off from aid just when they
most need it.
Proper reform in our national bank
ing laws would help the wage-earner
because it would assure him of steady
and of prompt payment
for his services. Funds would flow
constantly through the channels of
honest industry The stability and in
tegrity Of the banks Of the United
States would be safeguarded and wage
earners, even though they had no bank
account. would profit from it as large
" as any other class of men.
Christmas Eve.
The boar Of time where the frost's gray