Gold payments of duties have now stopped, never to begin again. They still ran down after the repeal on November 1, 1893, being thereafter as follows:

And now, and for months past, not one dollar in gold or gold certificates has been paid into the Treasury.

The habit of paying duties in gold having been broken, and new banking customs inaugurated, and for months, it will never be resumed. It can not be inaugurated again without concurrent action of all New York banks. (W. Dodsworth, Appendix U, page 75, item 5.) Selling bonds, and more bonds, and still more bonds, will continue, however much revenue is obtained. No two or ten banks alone can change it. What a spectacle do we make of ourselves in these wasteful bond sales! What a commentary on the financial wisdom of a Government to maintain a financial system that compels it to struggle to keep

FOUR KINDS OF SO-CALLED PRIMARY MONEY

at a parity, by refusing to accept three kinds of it in a loan made to preserve the parity itself and thus surely destroying that parity in the act of maintaining it. What a farcical, were it not a melancholy exhibition, of financial strabismus or imbecility is the chasing people around by agents of the Treasury and trying to prevent them from getting the gold it is their legal and moral right to have, as has been done in New York! What contempt is thrown on a system that can only be maintained by such empirical practices! Such a spectacle was never before seen in a nation claiming that all of its money was at a parity It can not be that Congressmen, under the solemnity of their oaths, patriotic manufacturers, merchants, and bankers will stand idly by and see this disastrous work go on!

The Walker bill, as before said, will also wholly relieve the anxiety of all business men and bankers and of the whole country, because of sudden changes in

THE POLICY OF THE GOVERNMENT

in changing the Secretary of the Treasury or Comptroller of the Currency. Whether there is a surplus in the revenues of the Government or a deficiency, as compared with expenditures, will be of itself a matter of entire indifference to the business and banking community. Of course the fiscal policy of the country, aside from the monetary situation, will be of the same import as now, as regards promoting or injur ing business, and the promoting or injury of business will react on the banks, but such influence will not affect the banks directly or the business situation directly, disarranging the finances as now. No purely currency disturbances can then exist, or any threat of a gold premium. The banks will then easily and without cost to them maintain gold and silver and paper at a parity, precisely as the New England and Louisiana banks did before 1860, and as the Bank of France and the Bank of Germany and other European nations that have both gold and silver as primary money now maintain the parity between each and all kinds of money. There was only $3,500,000 of specie in the country in 1800. In 1859 it was $14,500,000. The banks did not buy it. It came to

them in the way of their regular business. On October 4, 1879, nine months after the resumption of specie payments, the New York banks had only $19,000,000. Twelve months later they had $63,000,000. How gold came out of its hiding as confidence was restored! There need be no anxiety as to there not being

SUFFICIENT GOLD IN THE COUNTRY,

for there is to day, by reports of the Mint and Treasury and Comptroller's departments, $315,000,000 of visible gold, while the visible gold in England, which has two or three times the foreign commerce we have, is only $145,000,000, and its normal visible gold is less than $130,000,000. In normal financial conditions no one desires gold but banks. Gold earns banks full interest in currency issued by the bank. It earns nothing to anyone else.

Under the workings of the bill only $246,000,000 of greenbacks will have to be assumed by the banks in order to wholly relieve the United States Treasury from any further responsibility for the current redemption of any form of paper money in gold. The bill will receive favorable consideration from the advocates of the use of silver in our coin money, for it

HELPS SILVER IN THE ONLY PRACTICAL WAY

it can be helped, namely, by increasing the actual use of silver dollars among the people to the extent of nearly $300,000,000.

The permission in the banking bill, for banks to "keep their coin or bonds at any place, approved of by the Comptroller of the Currency," is designed to permit the massing of the major part of the visible gold in the country in New York and San Francisco, as was contemplated in the law passed under which the greenback was issued as a "legaltender note." They are only redeemable in coin in New York and San Francisco. Of course, the banks will redeem over their own counters, as they now do, in the legal-tender notes of banks other than the bank upon which the demand is made, or in silver, and if anyone desires gold it will be secured from banks by their regular customers or from the national clearing house in New York or San Francisco, precisely as is the law to-day for the legal-tender notes at the United States subtreasury. (See page 18.) The clearing house provision,

UNDER THE CONTROL OF THE SEVEN EXPERT ADVISERS

to the Comptroller of the Currency, will permit the massing of the gold and its use, precisely as it is massed and used in England, Germany, or France. In no other way can a parity of several kinds of money be maintained. No single bank, alone and unaided, can do it.

The provisions technically apply to single banks, because, unlike a law organizing a national bank with branches, the Walker bill, like our institutions, builds up a banking system from the bottom. In practice all banks will obey these provisions through the agency of the national clearing house.

Again, bankers are anxious to know about the amount and kind of coin money they would be required to carry in their reserve under the Walker bill. There need be no fear on this question, and especially on the gold question. There is now

ENOUGH VISIBLE GOLD IN THIS COUNTRY

to considerably more than double the amount the banks would be required to carry under the bill--in fact, they now have enough in their

own vaults--and immediately upon the adoption of the bill there would be no possible inducement for individuals to longer hoard gold. It would as it always has done under such circumstances-come out from its hiding place and be again deposited in banks.

Hon. George E. Leighton, of the Boatman's Bank of St. Louis, tells me that of the taxes in that city payable before December 1, 1895, $48,000 in gold coin, in sums of less than $40, was paid in over the counters of the city treasury by small taxpayers, showing that the newspaper discussion of the danger to our currency has already very largely induced the habit of hoarding, and if the present condition of things continues for three or four years the habit will be thoroughly fixed and hundreds and hundreds of thousands of commercial gold-that is to say, visible gold-will

FIND ITS WAY INTO SMALL HOARDS,

never to be brought from the hoard until a generation succeeds the present one.

The amount and kind of money the banks would have to carry in their reserve is as follows:

The 5 per cent gold redemption fund which the Government would
hold free of cost to banks to redeem their currency notes would be.

Gold required in all the national banks under the bill would be.......
A total of $166,000,000 Government and bank gold.
Silver might be used to the amount of.....

Greenbacks of other banks (excess of sum required by law)..

Total cash reserve held..

Balances held with reserve agents...

Total of all reserves held September 30, 1892...........

327, 000, 000

....

244, 000, 000

571, 000, 000

This when the country was in a normal condition, on September 30, 1892.

There is not the slightest authority conferred by the bill on one bank to control, interfere with, or in any way to influence another bank or on any clearing house to do so, any further than under existing law and conditions. It confers no control or authority upon any clearing house over any other clearing house or bank. Each clearing house will be under the control and management of the banks that form it. The national clearing house will be under the control and management of the clearing houses that form it. There is no centralization of monetary power in the bill any more than there is centralization in the action of any town or county in the election of their officers by the people, the officers executing the will of the people as determined by the people in such town or county.

I again repeat the statement that the bill makes a solid national system without making a national bank. It puts the whole practical management of the banking system of the country first in the hands of the people, through the President, the Secretary of the Treasury, and the Comptroller of the Currency, but its actual management in the hands of the banks themselves, through the seven expert advisers, to the great interest and safety of banks and with great safety and economy of the people in lowering the rates on loans and discounts, while increasing the dividends on bank stock.

Thus it gives the people of the United States a well-knit together banking system, strong and elastic, as free from every influence liable to cause anything approaching a condition of panic as England, France, Germany, or any other nation has, without a single feature objected to in one central national bank, with branches.

The fact is patent to all that the "depletion of the gold reserve occurred before the revenue became deficient. Whatever additional difficulty the deficiency of the revenue may have caused the Treasury, the depletion of the gold reserve can not be attributed to something that occurred after the depletion had been going on for three years, and this is emphasized by the fact that a dozen years ago there was a depletion of the reserve with large surplus revenue."

Never did a bill come before Congress with a more complete justification from a person who is an expert, whose authority is beyond question, than the Walker bill finds in the words of Mr. W. Dodsworth, editor of the New York Journal of Commerce and Commercial Bulletin, of New York, in Appendix U, page 75. Such relations as he describes as existing between the United States Treasury and the New York Clearing House are inexcusable in a banking system, and yet they are absolutely necessary to the maintenance of the current redemption of the legal-tender notes of the Government. The people rise in arms against any such needless guaranteeing of the soundness of 4,000 banks with the money collected in taxation from them. This system compels the United States to keep nearly $300,000,000 constantly on hand, in order to maintain the confidence of the financiers of the country in the currency of the country. From 1880 to 1890, this sum was equivalent to more than one-half of the banking capital during that period. This shows a lack of statesmanship or financial knowledge thoroughly discreditable to every branch of the American Governmentfrom the Executive down.

The present system makes unavoidably a waste of the people's money collected from them in taxation, as is proved by the Treasury figures and statements in this paper, of a sum very nearly if not quite $50,000,000 a year, certainly a direct tax for interest in the sum of $12,000,000 a year. (See Appendixes A and B, p. 37.)

RECAPITULATION.

Under the Walker bill there will be a saving to the country in the management of the national finances and in lower rates of interest to the people by banks, of over $50,000,000 a year.

1. The Walker bill makes not the slightest change in the existing conditions as to gold coinage or silver coinage or the use of gold or silver, legal-tender notes, Treasury notes, or any other form of paper money, any further than is necessary to relieve the Treasury of the United States from being in any way responsible for the current redemption of any form of paper money. It provides a surer and safer method for the current redemption and also the final redemption of such notes than under existing laws.

2. It makes no change in the existing banking system other than to enlarge and perfect it in accordance with its original purpose.

3. While dispensing with the formal bonds for taking out currency, it supplies their place with a currency that is the equivalent of small non-interest-bearing bonds instantly payable upon presentation.

4. It makes sure to banks the legitimate profit on the currency they take out in 10 per cent localities and in 4 per cent localities, and in all other localities proportionately profitable to the banks in each locality.

5. Under the present law there is no conceivable way of preventing any individual, Hebrew or Christian, from taking out of the Treasury, without the slightest hindrance, just as much of gold as he can secure of greenbacks, to hoard or ship out of the country, and in disobedience of economic law.

Under the proposed bill there is no conceivable way gold can be shipped out of the country in disobedience of economic law.

6. Under the present law the cost of currency to banks, and consequent rates of interest to the people, is less and less in proportion as interest is low and growing lower.

Under the proposed bill the profit on currency is more and more as interest rates increase, and the profits grow less to banks on the currency as interest decreases. This tends to depreciate interest rates.

7. Under the present law profits on currency vary every day in the year at the same rates on loans and discounts.

Under the proposed bill the profits on currency are the same every day in the year.

8. Under the present law practically every dollar of the $1,000,000,000 of our currency notes is redeemable in gold at the United States Treasury.

Under the proposed bill not a dollar of currency notes of any kind will be redeemable at the United States Treasury. It will give, practically, final gold redemption at the national clearing house in New York, and redemption in legal-tender notes and silver at country banks.

9. Under the present law the money of the people is made safe by banks being obliged to deliver to the Treasurer of the United States an amount of capital equal to the amount of their currency notes when they commence business.

Under the proposed bill they will deliver the same amount of capital when they close business. Under both systems the Government guarantees every dollar of the paper money in circulation and at no cost to the Government. (See p. 603, Report of Comptroller of Currency, 1895; also see Appendix L, p. 56.)

10. Under the present law the Comptroller of the Currency does not know the exact condition of banks except by occasional reports and occasional examinations by official bank examiners.

Under the proposed bill the Government will know of each day's condition of the banks, and also by the same examinations as under present law.

11. The present law takes out of the currency the banks are allowed the 5 per cent redemption fund the bank is required to keep.

The Walker bill provides that the Government shall furnish it by setting aside 10 per cent of the money the banks pay for the half of the currency they buy, in the form of United States legal tender notes.

12. The present law forbids, under severe penalties, the banks under any circumstances to use their reserves for the very purpose for which the banks are required to keep such reserves.'

The Walker bill allows the banks to use their reserves in any legitimate way for the purposes for which they are required to keep a reserve. 13. Under the present law every operation of the Treasury expands or contracts the currency to the serious injury of the business of the country. Witness the outcry all over the country that the Treasury is contracting the currency and injuring business in collecting the pay for the bonds recently sold.

Under the Walker bill whatever sum the Treasury had or failed to have available, would not affect the volume of the currency of the country by the smallest fraction.