The Columbia herald. [volume] (Columbia, Tenn.) 18??-1935, 1912-12-06
REFORMS URGED IN
BANKING SYSTEM
BY Mr.. M'vEAGH
THE SECRETARY or TREASURY
WARNS CONGRESS OF FiNAN.
ciAL CRISIS AHEAD.
METHODS ARE PANIC BREEDERS

MEl1UDO AhL FANlL Dk[[U[kS
present Currency System Is Denounc-
ed as Full Of Dangers--Rellef
Measures Must include Assurances
of FIexibiIity and Stability.
WASHINGTON, Dec. 5.--Strongly
urging radical reform of the '.unrea-
soned and unscientific" banking and
currency system of the United States,
Franklin Mcveagh, secretary Of the
treasury, freely warns congress in
his annual report that. the federal
government, as long as the present
scheme exists, will be exclusively re-
sponsible for the commercial, indus
trial and social disasters which flow
from panics and attack, directly or
indirectly, every home in the nation.
The present system promotes and
develops panics, and legislation is ur-
gent, declared Mr.. Mcveagh, in out
lining his idea Of the necessary gen
eral provisions Of an adequate relief
measure Aside from affording fiexi-
BILE and elastic currency and reserves
such revision, he says, should nring
the banks into organized cooperation
and provide for a central agency
through which they could work to-
gether free of political or trust con-
troll. -
According to the estimate of the
treasury department, the treasury
foresees a deficit of $22,556,023, ex-
elusive of Panama canal expenditures
for the fiscal year ending June 30,
1914, the first fiscal year of Presi-
dent wilson's administration. In
GLIDING the canal expenses, the de-
felt is estimated at $52,730,455. The
canal expenditures, he adds, howev-
err, may be paid under the law from
bond sales. The estimated receipts
for that year are s71o,oOO,OoO. while
the ordinary appropriations are esti-
mated at $732,556,023 and the canal
expenditures at $30,174,432. Undoubt-
eddy having tariff revision in mind
the secretary announces that these
estimates are based upon present
conditions and laws.
For the current fiscal year, ending
June 80, 1918, Mr.. McVeagh estimates
that there will be surplus of $40,
100000, exclusive of Panama canal
expenditures, and a deficit of $1,000,
900 including the canal transactions
He estimates receipts for this veal
at $711,OO0,OOO and ordinary disburse
ments at $67O,SO0, 900.
In connection with financial reform
Mr.. Mcveagh says the people are
helpless under the existing evils. The
present system never permits tree
action at any time, because its liza
bility to sudden constraint and re
striction is, always part of the ma
tons financial consciousness.
A relief measure reforming thu
banking and currency system, TN
secretary declares, must include
among it's necessary features, pro
visions for never failing currency
and for the perfect elasticity and fiex
Utility of both: for the permanent or
ganization and organized cooperation
of the banks, which are now sufer
ing and causing the nation to sure
by reason of their unorganized ant
cooperative banks--this agency to b
securely free from political and ffus
control, but with the government nav
ing adequate and intimate superv
sion of it; for independent bankln
units-so independent that no on
bank can be owned, controlled 0
shared in any degree, directly or IL
directly, by any other bank; for tn
equality of all banks national 0
state, both as to standards and as t
functions-so that every requiremeh
made of national bank must be con
piled with equally by a state PAM
and every function or privilege ei
joyed by state bank shall be eIiJo!
ed by a national bank; for the ntillz'
ton and fuidity of bank assets; &c
the scientific development OF e.
domestic and foreign; fc
foreign banking as an adjunct of on
foreign commerce, and for taking tn
treasury department out of the ban
ing business"
Discussing customs reforms, seer
tary Mcveagh says that widesprea
exposures by the present adminlstr
ton of frauds have resulted III q
annual paying to the government
more than s1O,ooO,OOo. distinct
and underestimate"