The Commoner.
CHARLES W. BRYAN, PUBLISHER
VOL. 8, NO. 34
Lincoln, Nebraska, September 4, 1908
Whole Number 398
A FEW HINTS TO VOTERS
Before casting your vote with the republican party remember
some of these things :
.First The failure of the republican party to take steps to
provide for electing senators by popular vote, and the refusal of
the republican conventibn to endorse the reform.
Second The failure of the republican congress to pass a bill
providing for publicity of campaign contributions and the -refusal
of the republican convention even to endorse the reform.
Third The failure of the republican congress to pass a postal
savings bank bill and the hypocrisy of the party in endorsing this
reform, which it had just ignored in congress.
Fourth The passage by the republican congress of a currency
bill which enables speculative banks to convert all sorts of securi
ties into currency and actually reduces the margin of safety for
depositors instead of increasing it.
Fifth The destruction of representative government in the
lower house, where the republican speaker and his committee on
rules have all power and not even a majority can get a vote on a
popular bill if the speaker refuses consent.
Sixth The forty-nine per cent increase in the cost of living
under the republican Dingley tariff and its trusts, while wages
have increased only nineteen per cent.
Seventh The refusal of the republican congress to amend this
tariff although its iniquities are admitted and future revision has
been reluctantly promised by its friends after the storm is over.
Eighth The notorious fact admitted by Senator Aldrich, re
publican leader in the senate, that American tariff protected con
cerns sell their products abroad in competition with European
factories at lower prices than they exact from American consumers
and the refusal of the republican house of representatives to adopt
an amendment to have our government agents report on these
prices.
Ninth The republican leaders pretend they favor a tariff suffi
cient only to compensate factories for the difference between labor
cost in America and abroad, but the fact is that the republican
tariff is more than sufficient to pay the whole labor cost. On steel
products the labor cost fifteen per cent and the tarifF is thirty-two
per cent.
GUARANTEED BANKS
' . .-
MR. BRYAN'SADDRESSrAT-T6PEKA-Ab3U'SrT $'
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Mr. Chairman, Ladies and Gentlemen:
Why not make the depositor secure? The United States govern
ment requires the deposit of specific security when it entrusts money
to a national bank, although it can examine the bank at any time ;
the state requires security when it deposits money in a bank; the
county requires security and the city requires security; even the
banks require security from the officials who handle money. Why
should the depositor be left to take his chances?
Not only is the depositor without protection, but the security
given to nation, state, county and city lessens his security. They
are preferred creditors ; they have a mortgage on the gilt edged as
sets and the depositor must get along as best he can with what re
mains. Why are the interests of depositors thus neglected?
A bank asks deposits on the theory that the depositor is sure of
the return of his money, and the laws ought to make the facts con
form to the theory. The depositor, the community and the banker
himself will be benefited by legislation which will give to every de
positor the assurance that that which is committed to the keeping
of the bank will be available to meet his needs at any time. Such is
not the case today, for while all banks are reasonably secure, they
are not absolutely so. This statement can be verified in several
ways.
First: The President has advocated a postal savings bank, and
his postmaster general, in presenting an argument in its favor,
pointed out that many millions are sent to European savings banks
every year by Americans of foreign birth who prefer to trust the
state institutions of the nations beyond the sea, rather than the pri
vate banking institutions here.
Second: It is known that a considerable amount of money is in
hiding, the amount increasing with the approach of a panic or busi
ness depression. This money is not only withdrawn from active use,
but is likely to be withdrawn just at the time when money is most
needed and when th withdrawal will increase the financial disturb
ance. It is impossible to reason with fear; it is futile to tell men
that they will probably get their money. The moment the depos
itors suspect a bank, they hasten to destroy its solvency. Distrust,
and distrust alone, can explain the hiding of money.
Third: The increase in the issue of money orders, payable to the
order of the purchaser, is another evidence that people are seeking
greater security for their money. The banks will pay an interest
upon deposits, and yet those who buy money orders prefer to lose
the interest and, in addition to that, pay the price of the money or
der in order to secure the government's guaranty.
Fourth: National banks confess that their banks are not secure
when they oppose the guaranty of state banks on the ground that it
would lessen the deposits in national banks ; and state bankers con
fess that their banks are not secure when they oppose a national
guaranty system on the ground that it will draw deposits away from
state banks. If you want to find whether banks are absolutely se
cure, ask the directors to give you their personal note to secure your
deposit and you will learn that they will not bear the risk which
they ask you to bear. f
Fifth: The experience of Oklahoma furnishes conclusive proof
that depositors do not feel that their money is safe in unsecured
banks. On the 17th of December, 1907, the Oklahoma legislature
enacted a depositors' guaranty law, which became operative Feb
ruary 4th, 1908. By the provisions of this law, all state banks, and
as many national banks as desire to avail themselves of the law, are
taxed one per cent on their deposits, and the money thus collected
is put into a guaranty fund. The banking board is authorized to
make additional assessments from time to time to keep the fund up
to this amount, and is directed to take possession of any insolvent
bank, pay the depositors in full, and reimburse the fund by collect
ing the assets of the failed bank. Five hundred and fifty-five banks,
including fifty-four national banks, had come under the provisions
of this law on the 14th of last May, leaving but 255 unsecured banks
(all national) in the state. Statements are made by the banks in
December and May. Between these periods the secured banks
gained in deposits $4,237,765.22, while the unsecured banks, all na
tional, showed a decrease in deposits of $1,101,807.86. A large part
of this increase represented money brought from hiding or from
without the state, but the decrease in the unsecured banks can only
be explained in dne way. A targe number of depositors withdrew
their money from the unsecured banfis, and deposited it in the se
cured banks, and this, too, in spite of the fact that in order to pre
vent withdrawals, the unsecured banks, in some instances, offered
a higher rate of interest than the secured banks were permitted to
pay; and it must be remembered also that the banks which suf
fered a loss of deposits were all national banks. And to make it'
certain that the difference vas caused by the guaranty law, the se
cured national banks gained, while the unsecured banks lost. While
the deposits were increasing in the guaranteed banks of Oklahoma,
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