Arizona republican., 1912-01-29
Banking and Politics.

II is to be sincerely hoped that the
democratic majority in the house OF
representatives will turn its back on
the proposition OF Representative
Henry Of Texas TO start an investiga-
ton OF the money trust" man
doesn't need to be a financier 10 know
what is likely to happen when doubt
Of the stability and soundness Of our
banking institutions is invited.
This paper doesn't know if there is
a money trust" or not. But it does
know this II knows that the plan
proposed by Representative Henry is
not the right plan to remedy the
it wouldn't be Il good thing to try To
repair a finely adjusted watch with
q slcdgc hammer.
The matter doesn't seem especially
difficult when its basic facts are con-
sidcred. The facts are about on this
order. The law requires the banks OF
this country to keep certain reserve
on hand to meet their obligations
Everybody knows these banks cannot
afford to keep these reserves locked
up in their vaults They couldn't
meet their dividends if they did. So
the reserve is distributed among GER
tain banks. many of which happen
TO be located in New York. for the
sole reason that New York is the
banking center Of the country. Sup
porters of the money trust" theory
a combination for the purpose of APP
propriating to themselves more than
their share of the financial operations
of the country.
Now, if the charge be true. what is
the logical thing To do? Almost any
body. it would seem. would say the
proper course is to amend the laws
that permit this alleged condition Of
affairs
This is matter that affects every
man. woman and child in this coun-
try You may not have a dollar on
deposit. you may not own a single
certificate. and you may live three
thousand miles from New York. but
you are vitality interested just the
same. Whatever affects the banks IN
New York affects every bank in the
United States. And if panic he
started in New York it viii spread
to Arizona and every other state.
1t viii drive capital into retirement,
will stop the wheels of industry. will
cut down the demand for the farmers
products. and will reduce the earn
ing capacity of every bread winner
i'm the United States.
a simple illustration will show how
this plan is likely to work. Sup
pose the legislature of Arizona should
meet month hence. and suppose one
of its first acts should be to order
an investigation of one of the banks
of Phoenix The fact would be
chronicled in the newspapers and
what would be the result? Ten
chances to one run would be
started on that bank within twenty
four hours.
Now, if congress orders an inVesti-
CATION of the money trust what will
happen? The reserve banks of New
York-the banks that are handling
millions of the currency from all sec
tions of the country. will be brought
under suspicion. The proceedings Of
the investigation will be published in
$4,000 newspapers in all parts of the
United States. There will be sharp
witted lawyers bent on proving the
existence of such trust. Volumes
of innuendo. inference. and dark sug-
gestion will be let loose and all this
will be directed against the insti-
tuition that supplies the very life
blood of trade and business. All that
means just one thing-panic. How
any man i'm his senses. for the sake
of partisan gain, could have suggest