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A Brace Of "national" Lies

A Brace Of "national" Lies image
Parent Issue
Public Domain
OCR Text

Not long ago a Greenback orator told Lis audience that under tiie NationalBanking act a man could take, say, $100,000 in United States bonds, deposit thera with the Treasurer at Washington and get his currenoy on them, theo take the currency and buy more bonds, get h's currency on them, and again buy bonds, and so on, thus accumulating millions of bonds by running tlíis little round with an original capital of only $100,000. This tremendoxis argument against the national-banking systein was received by the audience with applause, and no doubt convinced the credulous crowd that the system was a desperately wieked scheme for enabling a few " pampered favorites " of the Government to get possession of enormous amounts cf bonds without ever paying for them. Probably it did not occur to the orator or his hearers to inquire whether the facts snpported the theory. It is a fact which anybody who will take the trouble to read the law can find out for himself that any üve persons who will pay in the capital required - $50,000 in places containing not more than 6,000 inbsbitants, and $100,000 in other places - may start a national bank, and go into the currency-bond business. Such being the fact, how happens it, if the orator's statement is true, that on the lstof November last there were only 2,071 national banks in operation, while there were 4,501 State and private banks, besides a very large number of capitalists who would be only too glad to get a million or two of bonds at fan original outlay of only $100,000 1 The State and private bankers and the grasping capitalista must be snrprisingly stupid to let slip such a glorious opportunity to make f rom 40 per cent. to 1,000 per cent. or more on their money. But perhaps the orator will teil us that these fellows were not in the secret of the game. Very wel!; it is presumable that the national bankers were in the secret, and what is the fact with respect to them ? On the lst of November. 1877, the 2,071 national banks had ouly $318,207,231 in circalation outstanding, and only $341,260,900 in bonds deposited to secure the circulation. This vas an average of $164,800 to each bank, and, as there must be at least five members of any national-banking association, it was an average of less than $33,000 to eaoh member. Now, is itnot passing strange that these shrewd fellows, wuo know all about the trick of gettiug bonds for nothing, should be satisücd with so moderate a haul ? And here is another fact : Until Jnly 14, 1870, the circulation of the national bank was limited to $300,000,000. From that time to Jan. 14, 1875, it was limited to $354,000,000. Down to the date last named, therefore, there was a reason why the tankers Bhould not go on indefinitely getting bonds accordingto the plan outiined by the Greenback orator. But at that date all restriction upon bank issu3S was removed. Since then the bankers have been free to buy np all the United States bonds in market by the prooess indicated. So far from doing that, they have actually reiinced their cireulation $32,000,000, and their bonds 830,000,000 siuce they have been at liberty to inerease both indefinitely, as long as tliero were any United States bonds to be had. If they could get the bonds on the terms stated by the Greenback orator, it is certainly most wonderfnl that they have taken the opposite oourse, and reduced their stock of bonds. Tlie same correspondent who reporte the aboVê argument, and who has been present at many Greenbaek meetings in different pnrts of the country, mys that it Is cornisón forthe Greenbaek speakers to assert that the national debt has been mereneed hundruds of millions since 1866, and to point to the enrrent sales of 4-per-oetit. bonds in proof of the assertion. The wonder íb that people can be fotmd in this country Vfho are ignorant enough to swallow such ossertions; and yet there is reascü to heliere that thousands of such persons etfist, and read the neí7cjper8 to some limited exteat. Jt may not be tjseless to state for the infoimation of such tlitrt the national debt reached its maximum óö August 31, 1865, when it amounted to $'2,846,007,626. On the 31st of last montii it amounted to $2,278,717,452. The reduetion, therefore, Binoe the maximum was rsached, has been $567,190,174. The total debt beving interest August 31, 18G5, was $2,384.291,310. Onthe31.t tilt. it was $1,818,687,540. Thereduction ïnthedebtbe.-ïriüsfinteresi, tberefore, has been $565,603,775. Fron this it appears that the reduction since Í865 ha been confined almost wholly to the debt bearing interest, and the saving in the annnal outlay for interest by the reductioD has been not far from $40,000,000. As to the sales of 4-per-eent. bonds, t'ney prove nothing, except that debt bearing interest at 6 per cent. ia beiog converted into debt bearing interest at 4 per cent. For every $1,000 4-per-cent. bond aold a $1,000 6-per-cent. bond is redeemed, and a saving of $20 a year on account of interest is effected. The foregoing are two sample misstatemente out of many that are used as arguments by the "absolute" money agitators." These statements, and many more like them, are so manifestly false, and would so certainly be known to be false by any intelligent audience, that they are usually reperved by the better informed and more shrewd agitators for the more ignorant audiences, and for occasions when no reporters for the press are supposed to be present, and when no one is at hand who is prepared to disprove them. Still they are dangerom, and their utter falsity ought to be so thorougbly exposed that nobody can have anv excuse for beïievinsr them. - Chicago Timen.


Old News
Michigan Argus