Evening journal., 1912-12-06

studied the question admits It,
The only part Of our monetary medi-
um that has elasticity is the banknOte
currency, The peculiar provision OF
the law requiring national banks 10
maintain reserves to meet the call Of
the deposltors operates to increa'e the
money strlngency when it arises rather
than to expand the supply OF currency
and relieve II. 1t operates upon each
bank and furnishes a motive for the
withdrawal OF currency from the chan
nels Of trade by each bank TO save It.
self and offers no inducement whatever
for the use OF the reserve TO expand
the supply Of currency to meet the ex-
ceptional demand.
After the panic Of 1907 congress real
lied that the present system was not
/ adapted to the country's needs and that
under It panlcs were possible that
might properly be avoided by legisla-
( tive provision. Accordingly a mon
etary commission was appointed whicb
made a report I'm February. 1912 The
system which they recommend involv-
ed a National Reserve association.
which was. in certain OF its faculties
Ind functions. a bank. and which WIS
yiven through its governing authorities
he power. by issuing circulating notes
for approved commercial paper. by fix
ing discounts. and by other methods Of
transfer OF currency. 10 expand the
supply Of the monetary medium where
It was most needed TO prevent the ex-
port OF boarding OF gold and generally
to exercise such supervision over the
supply OF money I'm every part OF the
country as to prevent a stringency and
panic.
Certain Il is. however. that the OBJ
jections which were made I'm the past
history OF this country 10 a central
bank as furnishing monopoly Of
financial power TO private individuals.
would not apply TO an association
whose ownership and control is so
widely distributed and is divided be-
tween all the banks OF the country.
state and national. on the one hand.
aud the chief executive through three
department heads and his comptroller
of the currency on the other
There Is no class I'm the community
more interested in a safe and sane
banking and currency system. one
which will prevent panics and auto
maticauy furnish in each trade center
the currency needed in the carrying on
Of the business at that center. than
the wage Garner. There is no class in
the community whose experience bet
ter qualities them TO make suggestions
as to the sufiiciency of a currency and
banking system than the bankers and
business men.
Ought we therefore TO ignore Their
. recommendation and reject theii
financial judgment as 10 the propel
, method OF reforming our financial sys
TEN merely because OF the suspicion
which exists against them in the minds
OF many OF our fellow citizens: Is 4
not the duty OF congress to take NJ
the plan suggested. examine it from al
! standpoints. give impartial considera
. ton to the testimony Of those whose
! experience ought TO At them to give
t the best advice on the subject. and
then to adopt some plan which vii
h secure the benefits desired?
A banking and currency system
seems far away from the wage earne
p and the farmer. but the fact is tina
? they are vitality interested in a SAT-
system Of currency which shall grad
2 uate its volume TO the amount needed
? and which shall prevent times Of ar
Q tificial stringency that frighten CAPT
r tai. stop employment, prevent tn
: meeting OF the payroll. destroy loca
markets and produce penury and want
= The Tariff.
: I have regarded 1t as my duty in for
/. mer messages to the congress to urg
the revision OF the tariff upon princi
o pies of protection. II was my jude
o ment that the customs duties ought I
be revised downward. but that the re
duction ought not TO be below a rat
which would represent. the differenc
in the cost OF production between tn
article in question at home and abroad
= and for this and other reasons ] vetoe
several bills which were presented
me In the last session OF this congress
Now that a new congress has. bee
elected on IA platform Of a tariff fo
revenue only rather than a protectv
, tariff. and is to revise the tariff on tina
~ basis. II is needless for ME to occup
- the time of this congress with arg
Y ments or recommendation In favor {
~ a protective tariff.
Army Reorganization.
Our small army now consists OF *
u 500 men. excluding the 5000 Philil
Fl pine scouts. Leaving out Of considers
z. ton the coast artillery force. who's
p position is fixed IN our various Sc
Oh coast defenses. and the present CARR
s. sons OF our various insular posse
lie sions. we have today within the col
es tinentaI United States a mobile arm
o. OF only about $4,000 men. This littl
K force must be still further drawn upo
u to supply the new garrisons for IN
Is great naval base which is being estal
m lished at Pearl harbor. in the Hawai-
II an Islands. and to protect the loci
now rapidly approaching completio
g. IT Panama.
T. The forces remaining In the Unite
lg states are now scattered in nearl
IT, nifty posts. situated for variety
be historical reasons In twenty-foI
to states. These posts contain only fra
Sc lions OF regiments. averaging less this
ID 700 men each. In time Of peace It h'
been our historical policy to admin
ter these units separately by a &c