South Bend news-times. (South Bend, Ind.) 1913-1938, 1913-09-19
Put in Hands of Banking and
Currency Committee in Sen
ate, Where Hearings Are in
Progress on Measure.
PASSED PRACTICALLY
As In ORIGINAL FORM
Would Eliminate Present Bank
Note System and Establish
Twelve Federal Reserves to
Issue Currency.

WASHINGTON, Sept 19.-The
complete revision Of American bank
ing and currency methods proposed
in the democratic currency bill was
started on it's way TO the statute
books Thursday. BY a vote of 2S6
to 81 the house passed the bill in
practically the same form in which it
was originally proposed. Twenty
four republicans and IA progressives
Joined with the democrats in voting
for the bill.
With this overwhelming house ma
jority and the endorsement Of Pres.
Wilson behind it, the measure was
sent over to the senate. There il
was referred to the banking and cur
rency committee before which hear
ings on the subject already are in
progress. The committee may not be
ready to report for several weeks.
The measure would eliminate the
present American bank note system
under which banks issue currency
against government bonds, and estab-
lish a currency. TO be issued by II
federal reserve banks based on sound
commercial paper, which the govern
ment assumes the responsibility of
redeeming in gold or lawful money.
1t would place, practically every
phase of banking under the control
of a federal reserve board of seven
members TO be appointed by the pres
ident and a council Of bankers which
would have only advisory powers.
The system would be administered
through the reserve banks, situated
in II geographical divisions of the
country, capitalized at about $1,000
600 which capital must be subscribed
by the banks in the reserve district.
At the eleventh hour the house wrote
into the bill a disclaimer Of any in
tentiOn to alter the gold money
standard fixed by law.
Altered Little.
Ten days of earnest consideration
in the house failed to alter the bill
in any material particular. and it
passed virtually as drawn by Rep.
Glass Of Virginia. chairman Of the
house banking and currency COM
mittee aftsr conferences with Sen.
Owen. chairman Of the senate com
mittee; Secy. McAdoO of the treasury
department and the president.
Throughout the debate republicans
and prOgTessives vigorously de-
nounced the methods employed by
the democrats in framing the bill and
in perfecting its details in caucus.
ever, and no minority amendments
were adopted. On final passage but
three democrats voted against the
bill.
Sentiment regarding the measure
has not yet crystalllZed in the sen
ate. The senate committee is now
hearing interested citizens from all
over the country on the principles
of the bill. These hearings may con-
Low he
committee itself is expected to take
weeks in the discussion of the meas
ure, although the administration
forces in the senate hope to force an
early report to the floor where fur
Their extended debate is expected
A number OF invited experts were
still to be heard when the senate
committee finished today's hearings
and 1t is expected the public dis
until early next week. The bill will
then be taken up for discussion
within the committee room.
No Predictions Made.
Chairman owen would make no
prediction today as 10 the prospect
for action in the senate committee
Emphatic expressions have come
from democratic members as "a
changes they believed necessary in
certain features of the bill.
Further criticisms were voiced al
today's hearings. William Fl. Berry
collector OF customs at Philadelphia
said he believed the bill proposed a
system worse than that now in ope-
ration. In response TO questions by
Sen. Reed. he said its only valuable
point was that IL reduced the amount
Of reserves which national banks were
required 10 keep.
Mr. Berry said ne believed the
banks would be compelled to borrow
back at once the greater part of the
reserves that they might contribute
| to the regional reserve banks
Then instead Of being reservoirs Il
which the whole country would &c
/ for money, they would really be eIe
ments of weakness in the system
suggested Sen. Reed.