South Bend news-times. (South Bend, Ind.) 1913-1938, 1921-07-04
WILL HAYS PLANS
MORE CHANGES IN
POSTAL SYSTEMS
Postmaster General Reviews
Financial Situation of L.
). In Interview.


ROCHESTER. Ind. July "A
BILLION dollars which should be IN
circulation 20 aid the coming bus
mess revival is boarded in American
stockings. VIII II. Hays. postmaster
general, declared today in announc-
ing plans for revision OF the postal
savings system 20 make IL more at
tractive TO potential depositors
Through his reorganization plans
Mr.. Hays hopes 10 draw the hoard
ed wealth OF the country out OF it's
hiding places and into useful chan
nels.
The present treatment Of depos-
itors in the postal savings banks. he
said Sunday night. after conferences
with middle western bankers,
iamounts almost TO fraud" while
the government has profteered at
the expense OF the depositors 20 the
sum. in the last year alone Of ST.
10000.
Reorganization Plans.
His general plan Of reorganization,
which will be submitted 10 congress.
has been approved by bankers of
the east and middle west at confer
ences held in Washington. Terre
Haute and at his home here. Mr..
Hays assured the bankers that he
had no intention of entering the
postal savings bank in competition
with private savings banks but
rather hopes TO make II a valua bile
feeder OF esta blished banking insti-
tutions. While asking congress to
make the interest rate double the
average paid now he pointed out 1t
would still be below the average
paid by the majority of savings
banks.
Private banks cannot hope to
reach the vast boarded wealth which
offers a particular field for postal
savings expansion, Mr. Hays said.
He pointed out that seventy percent
OF the present 5Os,OOO depositors
are Of foreign extraction, and that
they as well as others of their
countrymen, who are accustomed to
postal savings systems abroad. will
trust no one but the United States
government.
Basis OBdnEcH.
To reach this field of potential de-
positors Mr.. Hays plans the following
basic changes in the present postal
system:
Increase the interest from two to
three percent.
Payment Of interest on deposits
held less than one.
Removal of the restriction against
depositors under ten years of age.
Provision for joint and trust funds.
Establishment OF postal savings
bank in $4,000 postofices instead of
the present $500.
Compensation for fourth class post
masters on the basis Of the deposits
they handle.
Rc-deposit of the funds in local
banks with more liberal qualifica-
tons rules for such repositories.
An enlarged board of directors,
including a representative of the
federal reserve bank and possibly
one or more civilians.
Lots of Business.
There is a lot of business in this
country that is really sick. still stag
gering under the shell shock Of war
and the debauch Of extravaganza,
Mr.. Hays, said. but there is good
deal more that is merely mailing
ering. What we need more than
anything else is the common sense
of courage and confidence. There is
/ of course. the greatest era of eXpan-
/ sion and prosperity ahead that the
world has ever seen. Every one
knows this and the only question dis
cussed is when will it start Well,
/ il is time TO go out and meet it,.
/ This we propose to help 10 do"
The postmaster general declared
that the hundreds Of thousands Of
postal savings depositors are prac-
tically being defrauded because their
certificates specially state that > per
cent interest is paid on deposits and
| do not state that nothing is paid on
deposits held less than one year.
/ Because of this system, he said, the
average interest paid in all money
\ held was only one and a half per
1 cent. His statement follows:
Postal System.
IL Is very Gel tain AAAt lDSAaA sd
ings system must be reformed.
With a treatment of depositors that
amunts almost to fraud, with the
number Of offices receiving deposits
reduced from 1888 in 1912 TO 6.314
in 1920. and with no real effort to
secure deposits, the postal savings
nevertheless, has practically twice
~ v,anv danosffors ag any other
savings banks in the country and
PAYS less than half as much interest
on deposits.
with one hundred and siXty-one
million dollars on deposit last year
from SOS. 900 depositors and with
the law providing that two percent
interest be paid. the government be-
cause Of the system, paid less than
one and one-half percent interest TO
/ those depositors and by re-depositing
at two and one-half percent interest
made a net profit over all interest