The Birmingham age-herald., 1913-10-24

a new banking and currency law efrec-
tive now.
Not until the year of the close of the
civil war had any great number of banks
taken out national charters. In the faI
or 1865 there Were 1000 of such banks
which was slightly in excess of the num-
Der of state banks which were in exis-
tence on January 1, 1861. Moreover by
means of the supplementary legislation.
which was procured on the earnest ad-
vice of the Secretary of the Treasury.
Salmon P. Chase, state bank note circu-
latlon was taxed out of existence.
In one respect the committee NAV find
a similarity Of sentiment as expressed aft
the institution of the present national
banking system, and as recently expressed
by the great body of representative Amer
lean bankers at Boston. For in the adj
ministration of President Lincoln the.crit-
icisms aimed at the proposed national
banking systems and the predictions of
dire disaster in case it was esta bshed
were even more pronounced than has
been the case since the pending banking
and currency bill has been under discus
sion But there was the same spirit in
the criticism of both cases
Prominent criticism in the early sixties
asserted that the proposed national bank
ing law was utterly unscientific 1t was
also predicted that it would prove a po-
tent influence at times in crea ting paniclxy
conditions These criticisms and protests
have been, in some IN easure, justified since
the national banking law was enacted.
The law itself has been responsible for
some of the money panics, and it has un-
doubtedly occasioned, in the aggregate,
very heavy losses, and yet, in spite of
these defects, the systems proved to be
what Secretary Chase and it's supporters
asserted it would be.
Its establishment and the issue of legal
tender notes were undoubtedly the turn
ing point in favor of the union in the
civil war. That, years afterward was the
unqualified testimony of John Sherman.
What with all sincerity and with an
earnestness and zeal which has COM
manded the admiration of American bank
ers, those who have had the banking
and currency bill in hand have tried to
do is chiefly to correct the Weaknesses
and lurking dangers which experience has
shown are contained in the present ma
tional banking law
But the new law will create a new ad-
ministrative system, and it is this which
the national bankers must adopt. The
adoption entails methods of readjustment
which able men are trying so to perfect
as to make the change from the old to
the new as congenial and undisturbing as
possible
The Bankers Part
In the framing and perfecting of a new
national banking and currency bill the
administration at Washington and Con-
gress are supreme, but it will be the
bankers of the United states, as a body
and Individually, who must put into ac-
tion the principles embodied in the new
bill. Not until there has been readjust-
ment and fairly good test of the suf-
ficency of this measure-or its insuffi-
ciency-will there be any dispostion-at
least of any account-on the part of ma
tional bankers to surrender their char
ters and become state banks If this
should be done. it is not likely that tie
movement will take place at the same
time. 1t will be gradual, one after another
1t Will be gradual, one bank after another
finding 1t expedient to make the change
SHOULD there be demonstration that any
considerable number of the national banks
are disposed to yield their federal char
ters, then Congress can speedily act in
such manner as to modify the law SO as
to remove that danger.