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The Commoner
WILLIAM J. BRYAN, EDITOR AND PROPRIETOR
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VOL. 8, NO 21
Lincoln, Nebraska, June 5, 1908
Whole Number 385
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DO YOU WANT TO "MAKE ALL BANKS EQUALLY GOODf
SHOW THIS TO YOUR REPUBLICAN NEIGHBOR
Oklahoma has the guaranteed deposit plan and the following Associated Press dispatch
tells of its operation in the first bank failure since that law went into effect:
"Guthrie, Okla., May 2 1 . Within one hour from the time H. H. Smock, Oklahoma
banking commissioner, had taken charge of the International Bank of Coalgate he had au
thority to pay the depositors in full, though the bank's cash and available funds in other
banks fell $22,000 short of the total amount of deposits. The commissioner was enabled
to do this under the operation of the new banking law, and this is the first time it has been
called into use. Under the operation of the guaranty banking law in Oklahoma a tariff of one
cent is levied upon the average annual deposits of the banks and thus money is used in pay
ment in-iull of all depositors of an4nsolvent state bankT-aftertteundshave-beenexhausted'
MR. BRYAN BEFORE THE CHICAGO BANKERS
Mr. Bryan was a guest at a banquet given
by the Bankers' club at Chicago on the even
ing of Friday, May 22. Among the guests were
'James B. Forgan, president of the First National
bank, with whom, it will be remembered, Mr.
Bryan recently had some correspondence con
cerning the guaranteed deposit plan. Following
are extracts from the Chicago Record-Herald's
report:
Mr. Bryan, in a speech which every one
present agreed was notable in the extreme, hit
out from the shoulder without stint. He told
the bankers that they must offer security to the
depositors of the United States, or the deposi
tors would see that a set of banks was estab
lished in the country that would offer security.
Ho declared, amid silence which was abso
lute, that the criminal law should be applied to
CONTENTS
MR. BRYAN BEFORE THE CHICAGO
BANKERS
A WORD AS TO COWARDS
THE LEADER VS. THE BOSS
CAMPAIGN CONTRIBUTIONS
THE OKLAHOMA WAY
WHAT REPUBLICAN EDITORS ARE
SAYING
DEMOCRATIC STATE CONVENTIONS
WASHINGTON LETTER
COMMENT ON CURRENT TOPICS
HOME DEPARTMENT
WHETHER COMMON OR NOT
NEWS OF THE WEEK
ofilcials of banks who Infringed the law which
forbids the loaning of more than ten per cent of
the capital and surplus to one individual.
Mr. Bryan, again amid silence, demanded to
know why any one should be "squeamish" about
applying as harsh laws to bankers as aro
applied to "the poorest citizens In the land."
In concrete form Mr. Bryan had the fol
lowing chief suggestions to make as to what ho
advises as a cure for the banking ills of the
country:
Absolute security should be guaranteed de
positors. Tho Oklahoma system should bo adopted
and every bank in a certain district should stand
behind every other bank; all banks should guar
antee each other. This should be done by a
tax of one-quarter of one per cent on the amount
of the deposits.
An emergency currency should be Issued
by the government, and ;aot by the banks.
The emergency currency should be given
to the banks on liberal terms as to security,
and bonds should not be insisted upon as
security.
No foreign system of banking should bo
introduced; the American system should bo im
proved so as to make it a secure system.
Despite the almost unbroken silence which
met the main portions of Mr. Bryan's speech,
and greeted all his chief suggestions, the au
dience seemed to be Impressed by the very force
and audacity of the Nebraskan.
At some particularly shrewd stroke many
of the bankers laughed, even if the joke did
appear to be on themselves. At the end of his
address Mr. Bryan got an ovation that seemed
something more than tho mero formal polite
ness to an invited guest. Cheers were heard
and the bankers applauded for moro than a
minute.
Tho one individual episode of the night
that aroused the room although it was by
no means somnolent before was the clash be
tween Mr. Bryan and Mr. Forgan. It was Mr,
Bryan's insistence on tho necessity for a pen
alty in regard to tho ton per cent loan ques
tion that drew Mr. Forgan into tho calcium as
the champion of tho bankers.
"Tho bank is established for tho deposi
tor," declared Mr. Bryan in leading up to his
point, "and tho dopositor Is the first to bo con
sidered. And what is tho situation today? In
nearly every case the failure of the bank Is
traceable to misuse of funds by those on tho
inside.
"It appeared in tho Walsh case hero in
Chicago that tho law as to loaning is directory
only, and that no penalty is attached for tho
loan of more than ten per cent of the capital
and surplus.
"No penalty, at least except such as may
be imposed in tho discretion of the comptroller.
And what is tho situation? If a bank loans
more than tho prescribed ten per cent It Is noti
fied not to do it again. If the bank continues
to loan moro than ten per cent it is again noti
fied not to do it. If it keeps on it keeps on
being notified. Am I not right?"
A coterio of bankers and business men in
tho rear of the room laughed.
This was too much for Mr. Forgan. Tho
president of the First National indeed had shown
several indications of not being in accord with
tho speaker.
Mr. Forgan raised his hand deprecatingly.
Every eye in the room focussed on Mr. Forgan
and left Mr. Bryan for tho only time during
the night.
"But the law has been changed," said Mr.
Forgan, who apparently did not hear Mr. Bryan
use tho words "capital and surplus" in leading
up to his point. "The law now forbids loaning
ten per cent on capital and surplus."
"And is there any penalty?" demanded Mr.
Bryan, in an aggressive voice and turning to
look at Mr. Forgan, who sat to his right, four
seats away, at tho speakers' table.
"There is no penalty," said Mr. Forgan,
"but the law Is now enforced."
Mr. Bryan gathered himself together,
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