The Birmingham age-herald., 1913-07-04
New York Banker Has Con-
fidence in Foresight of
Men Now in Control
| OBJECTIONS MADE
TO CURRENCY LAW
None, However, Is Regarded With
Serious Concern Because Men of
Ability Have the Subject
in Charge
Nv HOLLAND

BY HOLLAND
New York, July 3.-fSpecial)-A banker
! of this city. who was formerly president
| of the New York State Bankers asso-
citation and has been for some years re-
garded as an authority by the American
Bankers association, said this morning
that he was sure the disposition was
general among the bankers of the United
States not severely or cautiously to crit
icize the currency bill now before con-
gress. For bankers of intelligence do not
need to be assured that the government
at Washington does not contemplate any
measure which would be likely to i'm
pair the national banks seek to Sc
cure any legislation which would shift the
rigidity of the present currency system to
board having supreme authority such
as the federal reserve board will pos
| sess if the present bill becomes a law
In other words the administration and
congress do not contemplate the creation
of final board of authority from whose
decision there can be no appeal, which
will have power so rigidly established by
law as to make the entire banking COM
munity of the United States not much
more than mere puppet of the board.
If there were a purpose of that kind
and it were written into law the final
! effect would be disastrous for 1t would
reach harmfully the business interests
and the people of the United States
Banking should be as free and as thor
oughly adjusted to the discretionary judg
ment of those who direct the banks as
is possible. There should be of course
| laws to prevent improper management
or to counteraet a disposition to initiate
| the currency, and also to place in the
hands of the government the right of
supervision and regulation Absolute un-
| appealable control by the federal reserve
board would impart quality of arbitrary
rigidity from which governmental super
vision and control under the present law
has been happily free
| There seems to be an underlying con-
| viction that whatever bill Is passed by
Congress it will be SO framed as to meet
| the reasonable objections to the placing
of absolute, rigid and unappealabe con-
troll in the hands of board appointed
| by the President
One Cause of Suspicion
The former state bank president, when
speaking today of the currency bill now
! before Congress, said that careful read
ing of 1t as well as of statements made
by members of Congress who have had
some part in the preparation of this bill
at Washington a good understanding of
what the inherent or sovereign power of
the nation in respect to money really Is.
| The measure itself makes it inevitable
| that men of experience and economic
| learning should find themselves wonder
! ing whether there is not some confusion
| in the minds of some of those who are
| sponsors of this bill as there is certainly
confusion in the minds of many of the
people respecting the difference between
money and bank credits and currency.
One of the reasons which has been
| given for establishing a federal re.
| serve board (Which is in fact If not in
name to exercise almost all the func-
tions that central bank of reserve
would exercise) is that the people OF
the United States will never consent
that the control of currency be in the
| hands of a central institution whose
| executive management Is in the hands
of bankers. That was the objection to
the old United States bank and was the
chief reason why President Andrew
jackson vetoed the bill which renewed
| the charter of that bank.
| But the former state banking presi.
dent declared that a little reading of
history would show that even in the
greatest fiscal and financial crisis in
the country's history the administra-
| ton at Washington and Congress did
not pretend that the national govern
ment had exclusive authority and con-
troll over the currency. That was at the
| time that the national banking law
| was before Congress. The sovereign
authority over the coming of gold
and of silver. copper and nickle was
| then unquestioned. And silver, 1t was
acknowledged, constituted the funda-
mental money of the country. All pa
per which circulates as currepcy is
nothing but an instrument of ecredit
| excepting the gold certificates which
are no more than warehouse receipts
| for gold held in the United States
treasury.
The State and National Banks
| When the measure which Is now
known as the national banking law was
under consideration by Congress none