Show OBJECTS TO 1 COMPULSION IN CURRENCY Bill Currency Commission of b BanKers BanKers' Association AssociationS S f TaKes Stand 1 PREFERS BANKING TO fl t POLITICAL CONTROL V v Declares Owen Glass-Owen Measure Mea Mea- j o sure Imposes Unwise Handicaps BOSTON Oct 8 The B.-The Tho currency commission commission com corn mission of the American Bankers' Bankers association as as- V reporting today to the association asso asse elation in convention here bore asserted that it it favored the old national monetary V commission bill bUl and opposed the currency curr cur cur- r rency ncy measure now before congress forthe forthe for forthe the following reasons Because under the old plan investment invest inest ment meat by bankers in the stock of the V central rc reserve association a was elective not compulsory whereas under the proposed proposed pro pro- V posed bill bankers must subscribe one one- S fifth filth of their capital stock to the federal fed fed- eral oral reserve O banks or go out of busi ness Because under the old plan money invested in the stock of the tho central reserve reserve reserve re re- re- re serve association was under the control of the tho banks investing in whereas under the bill the tho federal reserve I V board dominating the reserve resor banks was without the tho bankers bankers' control Because such control by bJ bankers bankers- denied them in the proposed prop bill was bill was wasn a n guarantee a against political domination domina tion and incompetent management V two important respects wherein the tho pending measure is lacking Signed by Hepburn and Forgan Tho The report of tho tim i iSby is signed t by bJ A. A Barton Hepburn chairman chair man of or the tho Chase Chao National bank of New York as os chairman of the commission commission commis commis- sion ion James B. B Torgau Forgan president of tho First National banic bank of Chicago o vice chairman and other members of the commission among whom were V John Perrin of Perrin Drake Drako and Riley Biley Inc Los Angeles C Luther Drake president Merchants' Merchants National bank Omaha and J. J F. F Sartori president SeV Security Se Se- V Trust rust and Savings Sl bank Dank Los Au Au- gales goles S SIn In part the report reads as follows Tho The bill in n its ts present form imposes unwise hardships upon the tho banks and V j equally unwise hardships upon the gen gen- J Ural eral public Tho The interests of the bank bank- V V J ra and commercial public are Ferrer n f no injury can bo be inflicted upon V th tb tho one without the tho other suffer V ing Tho chief chiet function of the banker is to loan his capital and other re to sources to his customers so that they may increase the tho activity and extent V of their business Any withdrawal of the banks banks' s' s capital from these lc iti 1 J I mato channels of trade trado not only entails on- on tails taUs a loss Joss to the banker hilt but also arso to the public Requirements Aro Are Unfair The bancs arc are required to subscribe subscribe sub sub- scribe to tho the federal reserve banks an amount equal to 20 o per per cent cont of oC their capital one half of which must bo ho paid aid in at once tho the other half being subject to call This is to bo ho taken over and placed un under er tho the management ement of a corporation corporation cor cor- in which tho tha have haye not oni n a minority representative but a avery avery I. I very cry limited voice indeed In return for the capital thus the appropriated the banks receive a certificate which cannot cannot can can- not be sold assigned or hypothecated over o which none of tIle the usual rights of property can be bo exercised The rhe banks are obliged ed to make mako this subscription or be dissolved Charters have over been regarded in the nature of a n contract con con- I tract and it is doubtful if under our constitution congress contres can cnn take away 1 the charter of ot a bank in this summary manner manDer not because the terms of the charter have been violated by tho the banks but because the bank management management manage manage- ment might refuse to mako make a no coerced investment nt such as ns the pending measure provides No Way to Get Money Back There is no provision whereby a 0 bank which subscribes money to tho capital of the federal reserve bank can recover the same except by liquidation cither either voluntary or enforced A A. bank is given ivon a maximum return of 5 per por percent percent cent upon capital subscribed if earned If the government can appropriate otto ono tenth of ot a banks bank's capital capita in the manner man man- ner ncr provided by this bill they ma may appropriate one tenth one tenth next year and so iO on until tho the capital is all transferred to the Jov government bank If they can fix the tho compensation at 5 per cent this year they ma may make it 4 1 per cent next year ear and 3 per cent 2 3 per cent 1 per percent percent cent or nothing nothing nothing-a a vcr very simple and easy process whereby the entire capital of tho the banks mo may be bo transferred to the Jov government There are a great eat many different kinds of Socialism but however tho the various theories differentiate they all allagree allagree a agree rec upon the tho fundamental proposition that tho the government that is the tho community com corn s as a whole should own all thereal tho the real estate all nil manufacturing enterprises enterprises enter enter- all banks all transportation companies in in short all money makin making utilities This proposition o of tho the government gov JOV- to tako the tho banks banks' capital in inthe inthe inthe the manner provided carried to the I extreme would easily accomplish so 50 far as the tho national banks are arc concerned con con- corned this contention on the tho part of I the Socialists For those thoo who t do not believe in Socialism it is very y hard to accept and ratify this proposed action on the part of the tho government Must Mast Act for Self Sel Protection Wo We have recounted tho the condition which confronts us as to that provision of the pending pending- measure in order to impress upon tho the banks tho the fact that wo we have reached a point where we wo must act net in our own interests and for our own protection If we are arc not satis satisfied fied fled with tho the provisions of the tho bill we e ought ht to acquaint our respective representatives in congress of the fact and anel clearly point out and impress upon them the changes which we think ought to be bo made It c It It has been boon proclaimed in congress and in the public prints that many features of of the tho pending measure are exactly like or similar to provisions pro of the tho bill reported by the national mone monetary mono mond- tary commission and which the tho bankers bank ers era era in convention The question question question ques ques- tion is is asked ed Ie Why if I the banks ap approved roved such provisions in jn the so I called Aldrich bill biU do they oppose similar provisions in tho the so 50 called Owen Glass bill This is the tho reason I Investment t Not Compulsory Ie a Investment in the stock of tho the Central Reserve association created by the bill of the tie national monetary ary commission was permissive not com coin cc b Under tho the terms of the bill of the national monetary commission the bankers controlled the mana management ement of the Central Reserve association It fol lows Jaws that an investment in in the stock of tho the association was an investment under their own control and mana manage manage- e emont mont ment On tho the contrary investment in in the stock of the tho federal reserve banks of the Owen Glass bill is compulsory The individual banks have havo a minority representation in the tho management ement of these federal reserve banks and have no voice whatever er in the tho selection of the federal reserve board which dominates dom dom- mates tho thorn federal reserve banks and the proposed measure only provides that one ono of the seven members must have banking experience the tho The Tho fact that the bankers bakers control Central Reserve association was a guarantee against political control and it was equally a guarantee a against incompetent incompetent in in- competent mana management two management two ement-two two important respects wherein tho pending measure is lacking |