The daily banner. (Cambridge, Md.) 1897-2008, 1912-12-05
BANKING SYSTEM
PR0M0TESPANICS
Secretary Of Treasury Urges
Radical Reforms.
SAYS PEOPLE ARE HELPLESS
Declares the Government Is Responsi.
BILE For Disasters Resulting From
Panics-For Central Agency.


Panics-For Central Agency.
washington, Dec. 5.-Strongly urg-
ing radical reform of the "unreasoned
and unscientific" banking and currency
system of the United States, Secre-
tary of the Treasury MacVeagh freely
warns congress in his annual report
that the federal government, so long
as the present scheme exists, will be
exclusively responsible for the COM
mercial, industrial and social disasters
which flow from panics and which at
tack, directly or indirectly, every home
in the nation.
The present system promotes and
develops panics and legislation is ur-
gent, declares Mr.. MacVeagh, in out
lining his idea of the necessary gen.
eral provisions of an adequate relief
measure.
Aside from affording flexible and
elastic currency and reserves, such a
revision, he says, should bring the
banks into organized cooperation and
provide for central agency through
which they could work together, free
of political or trust control
According to the estimates of the
treasury department, the secretary
forsees a deficit of $22,556,023, exclu-
sive of Panama canal expenditures, for
the fiscal year ending June 80, 1914,
the first fiscal year of President Will
sons administration. Including the
canal expenses the deficit is estimated
at $52,730,455.
The canal expenditures, he adds,
may be paid under the law from bond
sales. The estimated receipts for that
year are $71O,00O,000, while the ordi-
nary appropriations are estimated at
$732,656,023, and the canal expendi-
lures at $30,174,432.
Undoubtedly having probable tariff
revision in mind, the secretary an
nounces that these estimates are based
upon present conditions and laws.
For the current fiscal year, ending
June 80, 1918, Mr.. MacVeagh esti-
mates that there will be surplus of
100000, exclusive of Panama canal
expenditures, and a deficit of $780,
900 including the canal transactions.
He estimates receipts for this year at
SILL, 100000 and ordinary disburse-
ments at $50, $4,000.
In connection with financial reform,
Mr.. MacVeagh says the people are
helpless, under existing evils. The
present system never permits free &C.
ton at any time, because its liability
to sudden constraint and restriction
is always a part of the nations finan-
cial consciousness.
"a panic" he says, 'is as unneces-
sary and as avoidable as an epidemic
of smallpox You can have an epidemic
of smallpox if you disregard al that
science has provided as preventive.
So we will continue to have panics
only so long as we refuse to apply the
simple preventive which he who runs
may read.
"Not only does the system establish
ed by the present federal laws pro-
mote and develop panics, but at all
times the country is carrying the
needless and heavy burden of an unfit
and wholly insufficient banking and
currency system. This system never
permits entirely free commercial,
financial or Industrial action at any
time, because it's liability to sudden
constraint and restriction is always a
part of the nations financial conscious
ness"