The Bennington evening banner. (Bennington, Vt.) 19??-1961, 1912-02-28
SOME TAX DOCTRINE
Banks Favored Too Much and People
Too Little.


We have 146 towns in the state
that have fewer inhabitants than 100
years ago One hundred and eighty
two towns have a smaller population
than so years ago. We made it I'M
comfortable for capital to remain in
the state for a while; then we made
laws that the savings banks and trust
companies could gather in our loose
money and pay the state tax Of
seven dollars on q thousand and OK
empt the dspositor from taxation.
Consequently by shrewd legislation
and advertising, they have raked
Vermont as with fine tooth comb
until they have S73,936, S55.52 deposit
ed in these banks that are situated
in the larger towns and cities in the
state. $l6,477,11S.S7 is loaned on real
estate mortgages at home, $33,721-
461.52 is loaned on real estate outside
Vermont, and more than one-half OF
al 1.-The deposits are outside the state
at a much lower rate Of interest than
the banks get at home Our deposits
have nearly doubled in state banks in
ten years, and some men that would
feel beittled If you called them any
thing but honest and bright, will tell
you this is prosperity, when, In real
ity it has robbed our home markets
of our working capital, especially in
our smaller agricultural towns. 1t
has been made convenient for those
having money to get almost as much
and, in some places more out of their
money in state banks than at home
where they are not annoyed by tax
assessors and are supposed to have II
at their disposal at any time. To
get this back we must secure the
banks for as much again as we Dor
row, or nearly that, and. If in a small
back town they more often will not
consider a loan on a mortgage at all
and at the same time they may have
thousands of dollars from the same
place.
What Is the show for building up
Vermont under this system? Our
governors excuse for vetoing a bill
the farmers in our last Legislature
dared stand for was, "My administra-
ton faced a deficit of S20.000.0 900; my
only remedy was to depend on the in.
crease in bank deposits to meet it. u
In substance, put on more fuel tc
put out the fire He got S5,000,0O0 90
more last year and 3.451 new deposi
tors. At least one-half OF this will &c
TO help some other state besides Yer
mont
Commissioner Williams of our state
banks says, Under the present law
If conditions are normal, think there
can be no doubt that deposits in oul
state banks will increase fully as rap
idly in the next few years as in the
last three years, and If ii shall be
the case il will be necessary either &c
reduce the state tax on deposits or re
duce the rate Of interest" Would il
not have been more rational to have
said IF this be the case. we would
have to pay our minister in buck
wheat raised from vacant farms, as
we did hundred years ago."
In closing, Williams says, Money
is as safe today in Vermont State
banks as 1t can be in any known class
Of investments and the net income tC
depositors is more than they can re
cieve upon any class of investment:
where the security is good" No one
should know better than Williams
but do many OF our state banks stant
good to the depositor with stock ant
surplus for more than four per cent
to ten per cent and, as deposits in
crease, is not this growing less?
Is this better and safer than good
farm mortgages, or claims on some ii
dustrial business in the state, oil
good municipal or corporation bonds
in the state, where they stand good
for 80 per cent and pay as much In
terest and are exempt from taxes
Now. then. II individuals had the
same right to loan money on mort
cages or other industrial interests
through the state as the banks, thai
is, pay seven dollars on a thousand
state tax. would not some of this
money go back in the smaller towns
Would not the people have better
chances to borrow and at less rate
as there would be a competition al
home for good papers? They certain
ly stand no chance of making condi
tons worse The state would lose
nothing should the banks drop off in
their deposits in small way. II
would fund them with less liabilities
and safer for other depositors.
Then on general principles, are
banks any better than the people that
create them? Is man greater than his
Maker? For illustration would you
stand for the states allowing a cor
poration to ship well say Christmas
trees out of the state by paying 500
car state tax and other people OF
the state pay $500 to $4,000? What
difference is there, when a bank can
loan money for $500 on thousand
tax and an individual must pay near
ly three times that? There are per.
haps 5000 people in Vermont that
are interested In state bank stock and
$4,000 that are not, or about 20 TO l.
Which OF these are we legislating for?
Bankers get together and recon,
mend certain laws. The committee
on banks in our House and Senate Is
made up OF banking men. These
bodies are largely>represented with
banking men, Our halls are we'll rep
resented in time Of need with men Ia
look after their interests. Who Is
watching out for the people?-Corres
nOndencp of Rarrp Timps