emergency currency, stated before the committee, and has repeatedly said in public since, that but a small percentage of these notes would, in his opinion, ever be presented to the banks of issue or to the redemption centers for retirement. This means that these credit notes will remain in circulation to further stimulate the spirit of venture which cautious men are now deploring, and to further abet the system of speculation and gambling at the money centers, which is productive only of immorality and disaster. The majority of the committee resisted all proposals to incorporate in the bill a provision that would compel prompt redemption of these notes by the respective banks of issue, thus insuring periodical retirement when the necessities of legitimate business would have been satisfied and the notes would no longer be needed in the ordinary transactions of commercial life. This feature, which the minority sought to engraft on the bill, constitutes the virility of the Scotch and Canadian systems, which the majority so highly commend in their report and so severely disregard in the construction of their bill. That there is any emergent need of expanding the bank currency of the country to the extent of $213,000,000 certainly, and $320,000,000 possibly, is indisputably disapproved by the fact that the national banks, in whose behalf this privilege is sought, now issue but 62 per cent of the bond-secured currency authorized by existing law. Indeed, the banks that seem to have had most to do with the revival of this old Baltimore plan of nonsecured asset currency have outstanding to-day less than 40 per cent of their authorized circulation under the present national-bank act. Were there any real necessity for an addition to the volume of currency required for legitimate business purposes, could and would be met by the issuance of a part or the whole of the more than $300,000,000 of national-bank notes which the law now permits, but which the larger banks of the country persistently refuse to put in circulation. The only reply yet made to this suggestion is the claim that "there is not enough profit to the banks in the bond-secured currency to induce them to issue more notes." This simply reduces the proposition to a question of greater profit for the banks and not one of more money for the people. And in answer to the suggestion from the bankers that Congress is inviting disaster by failing to provide remedial legislation, it may be retorted that these banks themselves seem willing to create financial disturbance and to precipitate business distress by refusing to act under existing law, hoping thus to force the passage of this credit-currency device to increase their profits. Contrast this attitude of certain American bankers, either in spirit or sense, with that of the Imperial Bank of Germany, which has repeatedly issued millions of notes under a 5 per cent tax when its interest charge at the counter was but 4 per cent. Referring to this fact, Mr. A. B. Hepburn, of the Chase National Bank of New York, applauds the action of the German bank for "realizing its own advantage in supplying public needs and averting calamity," and yet this gentleman is one of the bankers and the Chase National one of the banks that take out less than 40 per cent of the circulation authorized by existing law because "the profit in bondsecured currency is not great enough." In short, these banks will only "supply public needs and avert calamity" on condition that Congress will provide a currency scheme that will enable them to make more money. Aside from the fact that we do not think this bill provides either an emergency or elastic currency, the minority members oppose its passage on the ground that there is no general business demand for it. Not even the familiar processes of organizing public sentiment" seem to have been able to awaken wide interest in this measure. The plan was contrived in formidable banking circles twelve years ago, and, periodically, when stockjobbers and speculators on the "street" have been pinched or squeezed by a high call rate of interest, the scheme has been put forward with constantly increasing vehemence. Whether so designed or not, it is, in our view, a scheme distinctly for the aggrandizement of the great banks at the money centers, with a smaller measure of benefit to the interior banks that have imitated the avarice of the reserve city banks in refusing to issue bond-secured currency as authorized by existing law. Obviously, the hope of these banks is, by thus failing to meet the requirements of legitimate trade at critical periods, to eventually force Congress to some expedient of their devising which will insure them greater privileges and enable them to make more money. Banks should, of course, make a fair profit on the business they transact. This the national banks are concededly doing. They are among the most prosperous institutions of this country. Never before in their history have they experienced greater thrift. They enjoy peculiar privileges and long ago successfully invoked the taxing power of the Federal Government to shield them from the competition of State banks. Why, then, should Congress be asked to extend their privileges by enacting a law which will enable them, without bond security, with a semblance of Government guaranty, to issue over $213,000,000 of crèdit notes, taxed only 3 per cent, and to be loaned to the people at rates of interest twice, and often thrice, as high as the tax paid? To do this would simply be to give the Government's sanction to a scheme of bank-note issue that will enable the banks to increase, by millions of dollars, their already ample profits. There are other grave, as well as many minor, objections to this bill, which need not be set out in this report, inasmuch as there seems to be no reasonable probability that the bill will get consideration by this Congress. The minority wholly dissents from many of the statements made in the majority report and disputes the force of its conclusions. As to the historical data of the report, most of it has no apparent relation to the credit-currency system propounded by this bill; particularly is this true of the references to certain foreign banking systems and as to the charts presented ostensibly to show that this bill provides the same sort and degree of elasticity as is had in Canada, Scotland, and other countries. This the minority denies, and when the time for discussion arrives will endeavor to demonstrate to the House that there is little, if any, similarity between the scheme proposed by this bill and the banking systems abroad. 2d Session. No. 5630. BRIDGES ACROSS THE TUG FORK OF BIG SANDY RIVER. JANUARY 4, 1907.-Referred to the House Calendar and ordered to be printed. Mr. GAINES, of West Virginia, from the Committee on Interstate and Foreign Commerce, submitted the following REPORT. [To accompany H. R. 21942.] The Committee on Interstate and Foreign Commerce, to whom was referred the bill (H. R. 21942) to construct bridges across the Tug Fork of Big Sandy River, having considered the same, report thereon with amendment, and as so amended recommend that it pass. The bill as amended has the approval of the War Department, as will appear by the indorsements attached and made a part of this report. Amend the bill as follows: In line 10 strike out the word "the" and insert in lieu thereof "may be selected by." In line 11 strike out all after the word "company," all of line 12, and all in line 13 up to and including the word "Kentucky," and insert in lieu thereof the following, "and approved by the Secretary of War." [Second indorsement.] WAR DEPARTMENT, Respectfully returned to the Secretary of War with recommendation that the accompanying bill, H. R. 21942, Fifty-ninth Congress, second session, to authorize the construction of bridges across the Tug Fork of Big Sandy River, be amended as indicated thereon. If thus amended, I know of no objection to the favorable consideration of the bill by Congress, so far as the interests of navigation are concerned. Brig. Gen., Chief of A. MACKENZIE, Engineers, U. S. Ármy. [Third indorsement.] WAR DEPARTMENT, December 17, 1906. Respectfully returned to the chairman Committee on Interstate and Foreign Commerce, House of Representatives, inviting attention to the foregoing report of the Chief of Engineers, U. S. Army, and to the accompanying copy of amended bill referred to. ROBERT SHAW OLIVER, |