The evening times. [volume] (Grand Forks, N.D.) 1906-1914, 1913-07-05
A FOOTBALL OF POLITICS.
The Country's Banking System and
the Proposed Currency Bill.
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N@sVW 4O1h 1lAl6S.J
1t Is to be hoped that the bankers of
the country and the business men of
The country are beginning to have a
clear understanding of what this cur
rency bill means. Four $40, 900 men
and n secretary Of agriculture. the
secretary of the treasury and the
comptroller of the currency are to
nave the power to fix by an order is
sued weekly or oftener the rate of
discount for each Federal Reserve
Bank, to suspend reserve requirements
TOR q period not exceeding 80 days. to
require n federal reserve bank to
r~ediscount the paper Of any other fed
eral reserve bank, and to regulate and
control the issue Of treasury notes to
FEDERAL reserve banks. If anything is
lacking to the completeness Of this
centralized control it must be in re-
spect to some detail that escaped the
attention of the authors Of the bill.
Yet, even after some days of discus
sion so little Is this bill understood
that 1t has been described as estab-
fishing a regional system Sin place OF
the more centralized Aldrich system"
1nasmuch as the "Aldrich system"
was based upon fifteen reserve dis
tricts. and Of the forty-six directors Of
the central body, the national asso-
citation only four. and they ~ex-oficio
members. were to be named by the
government, the rest being chosen by
the bankers of the reserve districts, it
Is difficult to see how that plan was
more centralized" than the Owen
Glass plan.
The other change made is import
ant; 1t has an importance which COM
petent students Of finance will be
quick to recognize. The provision re-
curing the gradual retirement dur
Ing a period Of 20 years Of the $780,
600, 900 of bond-secured national bank
notes has. been dropped. and an issue
not exceeding $500, 000. 900 Of treasury
notes-"obligations Of the United
States"-may be made to the reserve
banks in the discretion of the central
board, upon the security Of a gold re-
serve and bank assets. It appears,
therefore, that If the federal reserve
board shall happen to be Of the opin-
ion hat the true way to restore and
maintain prosperity Is to increase the
volume OF currency in the federal
boards discretion up to $500, 00O, 900.
1t does not appear than any adequate
safeguard against imitation has been
provided, any automatic system to
cause the retirement of these treasury
notes when they are no longer needed.
bankers and business men will soon
understand. even If they do not now
understand, that a new idea underlies
this banking and currency bill. the
Oklahoma idea, the Nebraska idea. It
reflects the rooted dislike and distrust
Of banks and bankers that has been
for many years a great moving force
in the democratic party, notably in
the western and far western states.
The measure zoe to the very extreme
in establishing absolute political con-
troll rel the business of banking. In
view of the perils involved in such a
radical change Of policy 1t is not sur
prising to hear that some national
banks have already practically decid-
ed. should this bill be enacted. to u r
render their national charters rather
than incur the great risks of attempt
ing to carry on a business controlled
by political appointees. .